Terms of Employment

The EU has enacted a number of directives designed to keep employees informed of basic information in respect of their employment.

There is a directive which requires that employees be told details of their terms of employment. It applies to all paid employees with a contract of the employment relationship. Some exclusions are permitted for employment relationships not exceeding one month or with a working week not exceeding 8 hours or casual or specific nature employment where there are objective considerations justifying non-application.

Employers must provide basic information in relation to a range of matters including

  • legal identity of the parties,
  • place of work,
  • title, grade, nature, or category of work,
  • a brief job specification,
  • date of commencement,
  • expected duration of a temporary contract of employment,
  • amount of paid leave or procedures for allocating and determining leave,
  • periods of notice to be observed by the employer and employee for termination or indicative terms,
  • basic amounts or other components of remuneration,
  • the frequency of payment,
  • normal working hours,
  • relevant collective

The information must be set out in a written contract or in a letter of engagement or one or more other written documents. The information must be given to the employee within two months of commencement of employment. Saving this, the employee must be given a written declaration signed by the employer.

An employee required to work in another country must be in possession of the information before departure of one of the documents which include the following additional information.

  • duration of employment abroad.
  • the currency of payment.
  • any attendant benefits.

The provisions do not apply where employment abroad is for less than one month.

Any changes in the terms of employment must be recorded in writing. More favorable provisions may be introduced by state.

 

General Consultation

There is a directive on the general framework for informing and consulting employees. There are two important principles of the directive. Practical arrangements for information and consultation must be defined and implemented in accordance with industrial relation practices in the state. When defining or implementing the framework, employers and employee’s representatives must work in a spirit of cooperation with due regard to rights and obligations.

The directive applies to all businesses with at least 50 employees in a state or to establishments with at least 20 employees as member states decide. States have the option of limiting information and consultation obligations of businesses with fewer than 50 or 20 employees.  Member states lay down how the numbers are calculated.

There are particular provisions for businesses pursuing political, professional, educational, scientific, artistic aims, or aims involving information or the expression of opinions, which may be adopted on condition that such provisions already exist in national legislation at the date of the directive.

States may authorise social partners to define and agree procedures for implementing employee information and consultation requirements.

  • Employee information and consultation cover three areas in relation to the business concerned.
  • Economic, financial, and strategic developments.
  • Structure and foreseeable development of employee and related measures
  • Decisions likely to lead to substantial changes in work organizations or contractual relations.

There are provisions for the protection of confidentiality to the effect that experts and employee’s representatives must not disclose information which has been provided in confidence, even after expiry of their office.

Within conditions provided for by national legislation, an employer may be exempt from the information and consultation obligation where compliance with it would seriously harm the functioning of the business or would be prejudicial to it.

When carrying out functions, employee’s representatives must have adequate protection and guarantees to enable them to perform their duties. States must ensure compliance with the provisions through adequate administrative or judicial procedures at a national level.

The following are regarded as serious breaches of the obligations.

  • The total absence of information or consultation prior to a decision being taken or announced publicly.
  • Withholding of important information or provision of inaccurate information, rendering ineffective the exercise of the right to information and consultation.

If there has been a serious breach with direct and immediate consequences in terms of substantial change to, or termination of employment contracts, the decisions have no legal effect. This continues until the employer has fulfilled his obligation and consultation obligations. If this is not possible, the employer must establish adequate redress in accordance with procedures in place in the state.

The provisions are without prejudice to the obligations in respect of European Work Councils or procedures in European scale undertakings or groups of undertaking for informing employees and consulting them.

Works Council

EU directive requires the establishment of Work Councils from 2011. The directive seeks to provide for employees’ transnational information and consultation rights. European Work Councils are a procedure for informing and consulting employees in Community-scale undertakings and groups.

All establishments i.e. branches of a business are subject to the requirements of a work council.

The central management of a business or group is responsible for establishing a council or an information and consultation procedure. If a representative is not appointed or the management is not located in an EEA state, it is the responsibility of the establishment or undertaking which employs the largest number of workers within a member state.

The central management must initiate negotiations to establish a European Work Council or employee information and consultation procedure. It must act on its own initiative or at the request of at least 100 employees or the representatives in at least 2 undertakings in at least 2 member states.

A special negotiation party must be formed by employee’s representatives. They may be elected or appointed according to the number of employees in each state where the business is present to negotiate an agreement with management in order to define the operation of the European Works Council and the arrangements for implementing a procedure for information and consultation of employees. The members shall receive the same protection as employee’s representatives as laid down in national legislation.

Transfer of Undertakings

The so-called TUPE regulations derive from the Acquired Rights Directive. This directive is designed to protect the position of employees when a business is sold or transferred.

The transfer itself does not constitute a valid ground for dismissal. Dismissals may occur for economic, technical, or organisational reasons or for categories of worker that are not covered by legislation protecting against dismissal.

Rights and obligations attached to the employment contract are transferred to the transferee when the business is transferred. States may provide that transferor and transferee are both jointly and separately liable for the obligations which arise before the date of transfer.

States may adopt measures to ensure that the transferor notifies the transferee of all rights and obligations that are transferred, insofar as they are known. Failure to notify does not affect the transfer of the rights or obligations concerned.

The terms and conditions in collective agreements must continue to be observed up to the date of termination or expiry of the agreement or entry into force of the substituted agreement.

Unless member states otherwise provide, the continued observation of rights does not apply in relation to old age, invalidity, or survivors benefits under supplementary pension schemes outside the statutory social security schemes. Member states may, however, adopt measures to protect rights conferring immediate or prospective entitlement on employees or persons no longer employed.

Unless states otherwise provide, the provisions do not apply where the transferor is subject to bankruptcy or insolvency proceedings, which have been instituted due to the liquidation of the assets under the supervision of a public authority.

Transfer in Insolvency

Similar provisions apply to a transfer during insolvency proceedings which have been opened in relation to a transferor whether or not they have been instituted with a view to the liquidation of the assets of the transferor. A member state may provide that the transferor’s debt payable before the opening of the insolvency are not transferred to the transferee, provided such proceedings give rise to protections for the employee that is at least equivalent to that in council directive regarding the protection of employment rights on insolvency.

The transferor and transferee on the one hand, and the representatives of the employee, on the other hand, may agree to alterations to the employee’s terms and conditions in order to safeguard employment opportunities by ensuring the survival of the economic entity.

Member states may take measures to prevent misuse of insolvency proceedings in a way as to deprive employees of their rights in the event of a transfer.

Where the transferor is subject to bankruptcy or insolvency proceedings, states may make the necessary steps to ensure that transferred employees are properly represented until the new representatives of the employee are elected or appointed. If the entity does not preserve its autonomy, the states must take the necessary measures to ensure the transferred employees continue to be properly represented during the period necessary for the new appointment.

If the representative’s term of office expires as a result of the transfer, they must continue to enjoy the protection provided.

The transferor and transferee must inform the representatives of their employees in good time of the proposed date of the transfer, reasons for transfer, legal, economic, and social implications and any measures envisaged in relation to the employees.

The transferor must forward such information before the transfer is carried out and the transferee must do so before the employees are directly affected by the transfer as regards to the conditions of employment.

Where transferor and transferee envisage measures in relation to employees, they must consult with the representatives in good time on such measures with a view to reaching an agreement.

The requirements apply irrespective of whether the transfer is decided by the employer or by an undertaking controlling the employer. It is not permissible to argue that the failure to provide the information is due to the failure by the seller to provide the requisite information.

States may introduce provisions which are more favorable to employees or promote or permit collective agreements between social partners which are more favorable.

States must introduce measures as necessary to enable all employees and representatives of employees to pursue their claims by legal process. The rules apply to part-time workers, temporary employees, and employment relationships governed by fixed-term contracts.

Securing Employees’ Rights on Insolvency

An EU directive provides for protection of employees in the event of employer’s insolvency. Rules must also apply to part-time, fixed-term employees on temporary contracts.

States must provide institutions to guarantee payment of outstanding employee claims related to pay for a period fixed by the member states. They may limit liability under conditions.

The minimum guarantee must be 3 months pay in a reference period of 6 months or 8 weeks in a reference period of 18 months. The states may apply rules to the organization financing the operation of the guarantee institution in accordance with certain principles provided in the directive.

The states may stipulate that the payment guarantee does not apply to contributions due under social security and supplementary schemes. They may take steps to ensure that non-payment of compulsory contributions due from the employer before the onset of his insolvency does not adversely affect the employees’ benefits in respect of those insurance institutions insofar as the employee’s contributions are deducted at source and the remuneration paid.

The interests of employees and persons who have already left the undertaking at the start of insolvency must be protected as regards to rights conferring on them immediate or prospective entitlement to old age benefits, survivor benefits, supplementary company or intra-company pension schemes outside national statutory schemes.

If an undertaking operating in at least two states is in insolvency, the employer’s outstanding claim must be met by the institution in the state where the employee works. States must exchange information on their guarantee schemes, forward such information to the Commission, and make it accessible to the public.

States may introduce more favorable measures for employees. Measures may be taken to avoid abuse or refuse the liability of the guarantee obligations if it appears that the fulfillment is unjustifiable because of the existence of special links between the employer and employee.

Collective Redundancies

EU directives provide for consultation on the occasion of collective redundancies.  Employers contemplating collective redundancies must hold consultations with representatives with a view to reaching an agreement.  They must at least cover ways and means of avoiding collective redundancies or reducing the number of workers affected and mitigating the consequence by resort to accompanying social measures and redeploying or retraining employees made redundant.

States may make provision for employee representatives to call on the services of experts in accordance with measures under national law.  Employee representatives must be furnished with all relevant information during the course of consultation to notify them of

  • Reasons
  • The period during which redundancies are to be effected
  • Number and category of workers normally employed
  • Numbers to be made redundant
  • Criteria used for selection
  • Method of calculation of compensation

The directive lays down the procedures to be followed.  The employer notifies the competent public authority in writing of the projected – collective redundancies.  The notifications must contain all relevant information concerning redundancies, consultations, and methods used to calculate compensation.  Where the cessation of activity as a result of a judicial decision, e.g. solvency, notification, it is only necessary at the request of the authority.  The employer forwards a copy of the notification to employee representatives who may send comments to the authority.

Collective redundancies take effect at the earliest of 30 days after the notification of the competent authority.  The authority may use this period to seek solutions.  States may grant the authority the power to reduce this period or extend it to 60 days following notification in cases where the problems cannot be resolved.  This is not compulsory for collective redundancies following a cessation of activity resulting from a judicial decision.  Extensions may be granted.

Updated Information Directive

Directive (EU) 2019/1152 on transparent and predictable working conditions in the European Union aims to improve working conditions by promoting more transparent and predictable employment while ensuring labour-market adaptability. It introduces minimum rights and updates the rules on the information to be provided to workers concerning their working conditions.

The directive contributes to reinforcing Europe’s social dimension as part of the European Pillar of Social Rights roll-out.

KEY POINTS

The directive is issued in the context of Article 31 of the Charter of Fundamental Rights of the EU which says that every worker has the right to working conditions which respect the worker’s health, safety and dignity, which limit the maximum number of working hours, to daily and weekly rest periods and to an annual period of paid leave. It is also a concrete follow-up of Principles 5 and 7 of the European Pillar of Social Rights.

Who is covered?

The directive applies to those who work more than 3 hours per week over a 4-week period (i.e. more than 12 hours per month) who are bound by an employment contract or in an employment relationship as defined by national law, collective agreements or practice in force in each EU country — with consideration to the case-law of the Court of Justice of the EU. Persons covered could include workers on zero-hour contracts, such as fast-food-chain workers, workers in logistical centres, shelf-stackers in supermarkets, domestic or voucher-based workers* and platform-economy workers, such as on-demand drivers or couriers, provided they fulfil the above criteria defining a worker.

Civil servants, the armed forces or members of emergency and law enforcement services may, on objective grounds, be excluded from Chapter III of the directive (Minimum requirements relating to working conditions).

Employment relationship

Employers must inform workers in writing, and at the latest within a week from the first working day, of the basic elements of the employment relationship, including:

the identity of the parties to the employment relationship, the place of work and the nature of the activity;
the start date and, if it is fixed-term, end date, as well as the duration and conditions of any probationary period;
basic pay, any other component of remuneration, including overtime, and the frequency and method of payment;
the duration of the normal workday or week when the work rhythm is predictable;
where the pattern of work is unpredictable, employers must inform workers of the reference hours and days on which they may be called upon to work, the minimum notice before starting work and the number of guaranteed paid hours.
For supplementary information as indicated just below, the deadline for employers to inform workers is at the latest 1 month from the first working day:

the duration of paid leave;
any training entitlement;
any collective agreements governing the worker’s conditions;
the identity of the social security body receiving social contributions, where this is the employer’s responsibility;
notice periods where the employment relationship is terminated or the method for determining such notice periods;
for temporary agency workers, the details of the user-undertakings (i.e. those making use of the agency workers’ services) when and as soon as known.
Workers relocated (‘posted’) to another EU country or to a non-EU country

Employers must provide relevant documents before departure including at least the following additional information:

countries where the work is to be carried out and its expected duration;
currency of payment;
where applicable, benefits in cash or kind relating to the work assignments;
information on whether repatriation is provided for, and the applicable conditions.

Posted workers covered by Directive 96/71/EC  must in addition be notified of, among other things:

the applicable remuneration under the law of the host EU country;
where applicable, any allowances specific to posting and any arrangements for reimbursing expenditure on travel and accommodation costs.
Minimum requirements for the employment contract

The directive sets a number of minimum rights for workers, including the right to:

not have the probationary period exceed 6 months, unless it is in the worker’s interest or when the activity justifies it;
work for another employer outside the established working hours without unfavourable treatment, unless incompatibility restrictions are justified on objective grounds;
for workers whose work pattern is decided by the employer and is entirely or mostly unpredictable, the right to refuse a work assignment outside previously defined reference hours and days without suffering adverse consequences;
request, after six months’ service with the same employer, a job with more predictable and secure working conditions;
receive training cost free, when the employer is required by EU or national legislation or collective agreements to provide such training.
EU countries may allow the social partners to conclude collective agreements which establish working conditions that differ from those referred to just above, provided that the overall protection of workers is respected.

On-demand contracts

EU countries which allow the use of on-demand contracts or similar employment contracts (e.g. gig-economy or zero-hour contracts) must take measures to avoid abusive practices, such as:

limiting the use and duration of on-demand employment or similar contracts;
putting in place a rebuttable presumption* that an employment relationship exists, with a guaranteed number of paid hours based on hours worked in a preceding reference period.
Complaints, redress, protections and dismissals

EU countries must:

ensure that workers who have not received the relevant information in due time have access to at least one of the following two measures:
submit a complaint to a competent authority and receive redress in a timely and effective manner; or
benefit from favourable legal presumptions
ensure that workers, including those whose employment relationship has ended, have access to effective and impartial dispute resolution and a right to redress*;
introduce measures to protect workers from any adverse treatment by the employer and from any adverse consequences resulting from a complaint lodged with the employer;
take measures to prohibit workers being dismissed because they have exercised the rights outlined in the directive.
The directive does not constitute justification for reducing the general level of protection already enjoyed by workers in the EU, and does not prevent EU countries from adopting legislation that is more favourable to workers.

The directive repeals Council Directive 91/533/EEC on Informing employees of their working conditions from 1 August 2022It has applied since 31 July 2019 and has to become law in the EU countries by 1 August 2022.

DOCUMENT

Directive (EU) 2019/1152 of the European Parliament and of the Council of 20 June 2019 on transparent and predictable working conditions in the European Union (OJ L 186, 11.7.2019, pp. 105-121)

Council Directive (EU) 2017/159 of 19 December 2016 implementing the Agreement concerning the implementation of the Work in Fishing Convention, 2007 of the International Labour Organisation, concluded on 21 May 2012 between the General Confederation of Agricultural Cooperatives in the European Union (Cogeca), the European Transport Workers’ Federation (ETF) and the Association of National Organisations of Fishing Enterprises in the European Union (Europêche) (OJ L 25, 31.1.2017, pp. 12-35)

Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions — Establishing a European Pillar of Social Rights (COM(2017) 250 final, 26.4.2017)

Charter of Fundamental Rights of the European Union — Title IV — Solidarity — Article 31 — Fair and just working conditions (OJ C 202, 7.6.2016, p. 399)

Directive 2014/50/EU of the European Parliament and of the Council of 16 April 2014 on minimum requirements for enhancing worker mobility between Member States by improving the acquisition and preservation of supplementary pension rights (OJ L 128, 30.4.2014, pp. 1-7)

Council Directive 2009/13/EC of 16 February 2009 implementing the Agreement concluded by the European Community Shipowners’ Associations (ECSA) and the European Transport Workers’ Federation (ETF) on the Maritime Labour Convention, 2006, and amending Directive 1999/63/EC (OJ L 124, 20.5.2009, pp. 30-50)

Successive amendments to Directive 2009/13/EC have been incorporated into the original text. This consolidated version is of documentary value only.

Directive 2003/88/EC of the European Parliament and of the Council of 4 November 2003 concerning certain aspects of the organisation of working time (OJ L 299, 18.11.2003, pp. 9-19)

Council Directive 98/49/EC of 29 June 1998 on safeguarding the supplementary pension rights of employed and self-employed persons moving within the Community (OJ L 209, 25.7.1998, pp. 46-49)

Directive 96/71/EC of the European Parliament and of the Council of 16 December 1996 concerning the posting of workers in the framework of the provision of services (OJ L 18, 21.1.1997, pp. 1-6)

Council Directive 91/533/EEC of 14 October 1991 on an employer’s obligation to inform employees of the conditions applicable to the contract or employment relationship (OJ L 288, 18.10.1991, pp. 32-35)

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