ZL Aktuell – Employment and Labour Law 09/2020

BAG: Employer’s right to information after termination

Employees are obliged to inform the employer about the placement proposals submitted by the Federal Employment Agency and the Job Centre in the dispute about the default of acceptance remuneration, stating the activity, the working time, the place of work and the remuneration – Federal Labour Court (Bundesarbeitsgericht – BAG), decision of 27 May, 2020 – 5 AZR 387/19.

In the case decided by the BAG, the defendant had terminated the plaintiff’s employment relationship extraordinarily and without notice. The plaintiff successfully brought an action against unfair dismissal and asserted a claim for compensation for default of acceptance. The defendant assumed, however, that the plaintiff had maliciously failed to take on another acceptable job. The plaintiff would have been obliged to have the remuneration resulting from this offset against the default of acceptance remuneration. The defendant therefore sought information by way of a counterclaim about which job offers were made to the plaintiff by the Federal Employment Agency and the Job Centre.

The BAG ruled in favour of the employer and thus solved the dilemma in which employers regularly find themselves after determining the invalidity of an employer-side notice of termination: if it turns out in the dismissal protection proceedings that the employer’s notice of termination was invalid and did not terminate the employment relationship, the employer is not only obliged to continue to employ the employee but also to make additional payments of the remuneration outstanding since the end of the notice period (so-called default of acceptance remuneration).

Though the employee must have the remuneration which he has actually earned or which he has maliciously failed to earn offset, c.f. sec. 11 Protection Against Dismissal Act (Kündigungsschutzgesetz – KSchG). However, this typically does not reduce the employer’s risk of default of acceptance. It is usually impossible for the employer to prove that the employee has maliciously failed to take up other employment. This is simply because the employer does not know whether and which job placement offers have been made to the employee by the Federal Employment Agency and the Job Centre. Nevertheless, this information is essential for the employer to raise objections against the employee’s claim for payment.

Practical note: The BAG’s decision is positive and provides employers with an instrument to defend themselves against the employee’s claim to remuneration for default of acceptance. As in the case decided by the BAG, the right to information can be enforced in court by way of a counterclaim. On the other hand, the BAG left open the question of the circumstances under which the employee could reasonably be expected to accept a job that had been placed. Nevertheless, the employee will no longer be able to rely in a general manner on the fact that the acceptance of other opportunities to earn money was unreasonable for him by the obligation to disclose the placement proposals submitted to him.

LAG Berlin-Brandenburg: Employee may refuse to record time by fingerprint

Employees may refuse to use an electronic time recording system operated with a fingerprint scanner if its use is not necessary, e.g. to prevent misuse in time recording – according to the ruling of the Berlin-Brandenburg State Labour Court (LAG) of 4 June, 2020 – 10 Sa 2130/19.

In the case on which the decision is based, the applicant refused to use a time recording system operated by a fingerprint scanner. The time recording system did not process the fingerprint as a whole, but only the finger line bifurcations (minutiae). The defendant then issued a warning to the plaintiff, following which the plaintiff brought an action for removal of the warning from his personnel file.

The LAG Berlin-Brandenburg ruled in favour of the applicant. The plaintiff was not obliged to use the time recording system. The warnings were therefore unjustified. The judges justified their decision as follows: the minutiae data set used is biometric data pursuant to sec. 9 para 1 of the European Data Protection Regulation (Datenschutzgrundverordnung – DSGVO) and personal data pursuant to sec. 26 para. 3 of the Federal Data Protection Act (Bundesdatenschutzgesetz – BDSG). The processing of such special categories of personal data is generally prohibited by law and is only permitted in exceptional cases if:

  • there is a voluntary declaration of consent by the employee,
  • there is a collective agreement on this matter, or
  • the processing of the data is necessary.

These conditions were not met in the present case. Neither a declaration of consent by the plaintiff nor a collective agreement which would have allowed the processing of the plaintiff’s personal data by the time recording system existed in the case decided. In addition, the LAG Berlin-Brandenburg decided that the recording of working time by fingerprint was not necessary either.

Whether the processing of personal data is necessary must always be assessed on the basis of a case-by-case weighing up of conflicting interests. In particular, no equally suitable measures may be available that would impair the employee’s general personal rights less severely. In addition, the impairment of the general personal rights and data processing must be in reasonable proportion. In the present case, the plaintiff’s general right of personality prevailed, since the defendant could not sufficiently argue that the time recording system is necessary to prevent abuse in time recording (e.g. by colleagues stamping time for other employees).

Practical note: The decision of the LAG Berlin-Brandenburg is particularly relevant against the background of the ruling of the European Court of Justice (Europäischer Gerichtshof – ECJ) of 14 May, 2019 (Case C-55/18). The ECJ had ruled that employers are obliged to record the working time of their employees by means of time recording systems. Nevertheless, the admissibility of time recording systems using fingerprints under data protection law is subject to high requirements which can be reviewed by the courts in individual cases. In view of the fact that employees are free to revoke consent to the processing of their personal data once it has been granted and that they must not suffer any disadvantages from the refusal to grant consent – i.e. alternative time recording options must exist – the conclusion of a corresponding collective agreement is recommended.

In the event of unauthorised processing of personal data, fines of up to 20 million euros or, in the case of a company, up to 4% of the worldwide annual turnover of the previous financial year are threatened.

LAG Berlin-Brandenburg: Face-to-face meetings of the works council are permitted despite rising infection rates

Employers must not prohibit planned face-to-face meetings of the (general) works council prior to upcoming secret elections on the grounds of increased infection rates, provided that compliance with the necessary protective measures is ensured – according to the LAG  Berlin-Brandenburg, decision of 24 August 2020 – 12 TaBVGa 1015/20.

In the case decided by the LAG Berlin-Brandenburg, the defendant, an operator of rehabilitation clinics, prohibited the general works council from holding face-to-face meetings. The defendant argued that a nationwide meeting of the works councils led to an unacceptable increase in the risk of infection with the COVID 19 virus. Particularly, because the meeting was to take place in a clinic.

The defendant therefore referred the general works council to the use of video or telephone conferences to hold the planned general works council meeting.

The LAG Berlin-Brandenburg ruled in favour of the general works council. Accordingly, the general works council was not allowed to be prohibited from holding the general works council meeting in person. The judges explained that, in accordance with the German Works Constitution Act (Betriebsverfassungsgesetz – BetrVG), the chairman of the central works council decides on the convening of the meeting and thus also on the venue. In addition, in the present case, it was not possible to hold secret elections via video or telephone conference.

At the centre of the dispute was the newly introduced sec. 129 BetrVG, which was adopted in response to the COVID-19 pandemic. Accordingly, meetings of the employee representatives, such as the works council, general works council and group works council, as well as the decision-making process can be carried out by means of video and telephone conference, provided that it is ensured that third parties cannot take note of the content of the meeting. However, this does not constitute a fundamental obligation of the works council to hold meetings and pass resolutions in this way.

However, the very wording of the new rules excludes elections to these bodies. Elections may therefore only be held in a traditional meeting, i.e. when the members are physically present in the same room. This applies in particular to secret elections. Elections would no longer be secret if they were conducted by raising hands, shouting, nodding their heads or similar means. Elections may therefore continue to be held as face-to-face meetings, subject to compliance with general protection and hygiene rules.

Practical note: A general obligation of the works council to hold meetings and pass resolutions by means of video and telephone conferences cannot be derived from sec. 129 BetrVG. On the other hand, the judges rejected the application of the general works council for general permission to hold face-to-face meetings. Rather, a weighing decision must always be made on a case-by-case basis, taking into account in particular the risk of infection, the reduction of this risk by existing protection and hygiene concepts and the reason for the meeting of the body.

LAG Nürnberg: Obligation to take part in a medical examination despite a certificate of incapacity to work

According to the State Labour Court (Landesarbeitsgericht – LAG) Nürnberg, decision of 19 May 2020 – 7 Sa 304/19, the obligation of the employee to participate in a medical examination is not waived solely because the employee falls sick on the date of the examination and submits a certificate of incapacity for work from his treating doctor.

In the case decided by the LAG, the plaintiff and the defendant disputed the legality of a warning for failure to appear for an ordered medical examination. The plaintiff, a 57-year-old carpenter, was absent due to sickness with an above-average frequency in 2018. The plaintiff’s activities included heavy lifting and carrying. Due to the plaintiff’s frequent periods of sickness, the defendant had doubts as to whether the plaintiff was still able to perform his duties despite his health restrictions. The defendant therefore instructed the plaintiff, during a period of incapacity to work, to undergo an examination by a medical officer in accordance with sec. 3 of the collective agreement for the public service for States (Tarifvertrag für den öffentlichen Dienst der Länder -TV-L). The date was initially postponed at the plaintiff’s instigation. The plaintiff did not appear at the new appointment which was subsequently agreed. The defendant therefore warned the plaintiff, claiming that the plaintiff had breached its duty of cooperation. The plaintiff requested that the warning letter be removed from his personal file. According to the plaintiff, the warning letter was wrongly issued because there was no obligation to attend the medical examination due to the applicant’s permanent incapacity to work.

The LAG Nürnberg did not share the view of the plaintiff. The plaintiff was obliged to take part in the medical examination. The warning is therefore lawful.

According to the TV-L, the employer is entitled to oblige employees to take part in an official medical examination if there is a justified reason to do so, in order to establish that they are capable of performing the work for which they are contractually obliged. The purpose of the examination is therefore precisely to determine what measures the employer can take to safeguard the employee’s ability to work within the framework of his duty of care. The employer cannot be expected to wait until the employee regains his ability to work at an unforeseeable time.

Practical note: The case law of the BAG on the scope of the employer’s right of direction during an existing incapacity to work of the employee was not applicable in the present case. Accordingly, employees are not obliged to take part in a staff meeting in the company during a proven incapacity to work. This is because the employee’s main duty to perform – the performance of the work owed under the employment contract – is suspended during a proven incapacity to work. Consequently, the employee’s obligation to participate in a staff meeting is also suspended in principle. As an exception, there is only an obligation to participate if there are “urgent operational reasons” for doing so. The situation is different; however, if – as in the case decided by the Nuremberg Higher Labour Court – the employee is already obliged to take part in the medical examination on the basis of a special collective agreement.

ArbG Iserlohn: Data protection may lead to the works council being dissolved

Violations of the General Date Protection Regulation (Europäische Datenschutzgrundverordnung – DSGVO) can constitute gross breaches of duty which can lead to the dissolution of the works council, according to the Labour Court (Arbeitsgericht – ArbG) Iserlohn, decision of 14 January, 2020 – 2 BV 5/19.

In the case decided by the Iserlohn Labour Court, two companies in the automotive supply sector, which were linked by a joint venture, intended to restructure a subsidiary.

The restructuring failed, however, so that it was decided to close the site. The employment contracts of all employees of the joint venture were subsequently terminated for urgent operational reasons. The works council chairman then sent an e-mail containing a large amount of internal documents to a trade union legal protection company and various law firms.

The attachment was accessible via a non-password-protected link and contained data of more than 150 MB – approx. 921 pages. Among other things, it contained transcripts of e-mails, personal calendar entries, invoices, contract texts, holiday applications, bills, official notices, customer enquiries etc. The data were used by the legal representatives of the dismissed employees in the subsequent proceedings against the employer for protection against dismissal. The employer therefore applied for the works council to be dissolved. The Iserlohn Labour Court regarded the transfer of the works council’s data as a massive violation of the works council’s competences under works constitution law and a serious breach of the principle of cooperation based on trust and thus a gross breach of duty entitling the works council to be dissolved pursuant to sec. 23 BetrVG.

Furthermore, the transfer of personal employee data was carried out with no legal basis, as it was neither necessary nor did the consent of the workers concerned exist. In addition, the situation was worsened by the fact that the e-mail of the works council chairman was only generally addressed to law firms and the retrieval link was not password protected. As a result, it could not be ruled out that uninvolved third parties could also gain access to the data.

Practical note: The mere fact that the works council allegedly acted in the interest of the employees cannot justify the transfer of personal employee data to such an extent. Even if a final clarification by the highest court of law as to whether the works council is to be classified as a body with sole responsibility within the meaning of the DSGVO is still outstanding, the works council is obliged to comply with data protection regulations with regard to the data it processes.

Cordial invitation to our upcoming ZL Online Workshop

Restructuring & Labour and Employment Law

Thursday, 15 October, 2020, 9 a.m.

We cordially invite you to our upcoming ZL Online Seminar. In approximately 75 minutes, our speakers will impart current practical knowledge of labour and employment law and invite you to exchange experiences on the subject of restructuring:

  • significance / impact of the entrepreneurial decision in particular

– to avoid a change of operation / mass dismissal

– selection of people based on social criteria

– to avoid (partial) transfers of business

  • typical process of restructuring
  • recent case law on mass dismissal

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