Commission proposes to improve transparency and predictability of working conditions and replace the Written Statement Directive of 1991
Proposal for a Directive on Predictable and Transparent Working Conditions 21 December, 2017
As part of the follow-up to the European Pillar of Social Rights, the European Commission has published a proposal, virtually on Christmas Eve, for a new Directive for more transparent and predictable working conditions across the EU. The Commission’s proposal complements and modernises existing obligations to inform each worker of his or her working conditions. In addition, the proposal creates new minimum standards to ensure that all workers, including those on atypical contracts, benefit from more predictability and clarity as regards their working conditions.
The Commission’s proposal for a Directive on “Predictable and Transparent Working Conditions” updates and replaces Council Directive 91/533/EEC which was given effect in Ireland by the Terms of Employment (Information) Act, 1994. The 1991 Directive gave employees starting a new job the right to be notified in writing of the essential aspects of their employment relationship. After more than 25 years, the Commission concluded that this Directive no longer captures changing labour market realities, in particular the new forms of work that have developed in recent years. Increased labour market flexibility and a growing diversity of forms of work have created new jobs and allowed more people to become professionally active. But it also exposed some gaps in the protection of workers and, in some cases involving vulnerable workers, contributed to new forms of precariousness.
The proposal follows a two-stage consultation of social partners. The social partners did not enter into negotiations to propose their own agreement. Therefore the Commission decided to take action in line with the Treaty.
Readers will be well familiar with the existing law requiring many particulars of the employment contract to be given in writing to the employee by section 3 of the 1994 Act. New additions are being made to the list of mandatory terms, being information on: probation (if any); training provided by employer; arrangements and remuneration for overtime, information on working time for workers on very variable schedules; and social security information where contributions are paid.
Instead of having two months to give the written terms or contract, an employer will be required by the Directive to give the statement to the employee, no later than the first day of employment. A written document, in paper or electronic form, must be given to the employee.
Member States will be obliged to provide templates and accessible information to reduce burden on employers. If there is a modification in the terms of employment, then any such modification must be notified in writing to the employee from the date of effect. (Article 5).
New obligations on employers
The real advances in the Directive will be the imposition of new material obligations on employers. These will be, firstly, to limit the length of probationary periods to 6 months, unless longer is objectively justified; the right to work for other employers, with a ban on exclusivity clauses and restrictions on incompatibility clauses; the right to minimum predictability of work (mentioned later in this article); the possibility to request a more stable form of employment and to receive a justified written reply normally within one month, but in the case of small businesses within 3 months, and orally for repeated requests); the right to cost-free mandatory training.
The enforcement of the Directive is also being beefed up with the introduction of two alternative procedures for addressing missing information. There will be positive presumptions (if no relevant information supplied, no probation period can be utilised, and there would be a permanent and/or full time employment relationship); or an administrative procedure to issue an injunction to the employer to supply the missing information. In addition, provisions based on the existing social acquis on compliance, right to redress, prevention of adverse treatment, burden of proof on dismissal, and penalties are to be introduced.
Scope of the Directive
Arguably one of the most profound and far reaching changes is to the definition of employment. Most EU legislation on working conditions do not give a definition of worker or employee at all, or refer to national definitions of ’employees’ or ’employment relationship’ for defining to whom the rules apply. As a consequence, the rules applying to the same categories of workers are being applied in different ways across the EU. Furthermore, the Commission believes this leads to inconsistencies in coverage for the growing category of non-standard forms of employment.
To close such gaps, the Commission follows settled the case-law by the CJEU as most recently set out in Case C-216/15 RuhrlandkLinik, and proposes to define an employment relationship as follows: ‘for a certain period of time, a person performs services for and under the direction of another person, in return for which he or she receives remuneration’.
Minimum predictability of work
Article 9 provides that, if a worker has a variable work schedule where the employer, rather than the worker, determines the timing of the work assignments,
- the employer must notify such workers of the periods of hours and days within which they may be required to work. That would enable workers to use the time not covered by such reference hours/days in other employment, in education or to fulfil care obligations. Workers may agree to work outside the reference hours and days, but cannot be obliged to do so, and must not be subject to detriment if they refuse.
- workers cannot be required to work if they receive less than a reasonable advance notice from their employer, set out in advance in the written statement. They may agree to do so but must not be subject to detriment if they refuse. What is considered a reasonable advance notice may vary across sectors.
These provisions do not apply in cases where the employer sets a task to be achieved, but the worker is free to determine the time schedule within which he or she performs the task. These are significant provisions.
We have not been used to substantive development in terms of EU legislation during the 21st century. The last significant directives enacted by the European Union were the two equality directives dating back to 2000 and the fairly toothless information and consultation directive of 2002. Employment lawyers have had to make do with recast directives and legislation from other fields with employment consequences such as the GDPR. Of course, we have had voluminous development in case law to keep us going. While the euro was on its knees and right wing populism was all the rage, there was little appetite for social improvements. But it seems that the recovery in the Eurozone economy and, perhaps, the freedom from obstruction caused by the forthcoming departure of the traditionally hostile United Kingdom, has given the Commission a new impetus to propose solutions to the new precarious employment conditions suffered by so many citizens today.
It is extremely interesting that, just a fortnight before the Commission published its proposal, the Minister for Employment Affairs and Social Protection produced the Employment (Miscellaneous Provisions) Bill, 2017, which purports to deal with almost exactly the same issues of precarious employment and uncertainty which impelled the Commission to act. The Irish Bill targets the “problem” of zero hours contracts, a problem for which there is not a great deal of evidence showing it to be prevalent in this jurisdiction. To crack this peanut, a legislative hammer is being brought to bear. At the same time, the Bill has nothing to say about the problems which the EU proposal addresses. In particular, the Bill offers no solace to workers struggling to fit into the traditional definition of employment used in domestic legislation.
In contrast, the proposed directive is a serious effort to bring those in precarious and marginal employment situations into the mainstream of employment protection law. The portents for the directive appear to be good. The European Parliament will almost certainly take an even more ambitious approach to the provisions of the Directive and compared to the early days of the European Union, no single member state can succeed in blocking the Directive from becoming law. The debate on the legislation will be interesting indeed. The social partners will remain divided with the trade unions in support of the changes. No doubt, business lobby groups and interests will oppose and try to delay the new legislation which will test the desire of the EU to address the real concerns of its citizens.