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I samarbeid med L&E Global har vi gleden av å presentere oppdateringer innenfor arbeidsretten for september 2016



L&E Global is pleased to present you with the most recent employment law updates for September 2016.



Latest Case Law: Australia: Fair Work Ombudsman Targeting Small to Medium Businesses In the last few years, the Fair Work Ombudsman (FWO) has become increasingly vigilant in pursuing small to medium sized employers who are not compliant with their obligations in relation to employee entitlements, in particular the payment of wages. The FWO is increasingly willing to take Court action against employers who are failing to comply with their obligations arising under the Fair Work Act 2009 (Cth) and any applicable awards. Recent judgments from the Federal Courts also show that Judges are prepared to hand down orders for large penalties where there have been serious contraventions. Given the increasing vigilance in this area of employee entitlements, employers and their directors and managers are strongly encouraged to conduct regular compliance audits and staff training to avoid exposing themselves to civil penalties and back payment orders.

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Latest Case Law: Austrian High Court ruling on Part Time Arrangements for Parents Parents who have been employed for 3 years or more have the right to request to work part time for the purpose of child care. In a recent decision, the Austrian High Court held that such a protection from dismissal arises regardless of whether the employer or employee are aware of the legal option to agree on parental part time. A parental part time arrangement, with all its consequences, comes into existence as long as the employer could have recognised that the reduction of the working time enables the parent to take care of his/her child and is still able to continue his/her work. Therefore, employers must always be careful regarding a request for part time by employees.

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Latest Case Law: Belgium: Is an additional flat rate expense covert pay when it is granted in addition to a reimbursement of actual costs? Not necessarily. In a case before the Labour Court of Appeal of Brussels, a dismissed employee claimed that the 300 EUR flat rate allowance, which she received in addition to the a reimbursement of actual costs, was covert pay and had to be included in the basic annual salary for the calculation of the indemnity of lieu. The flate rate expense covered taxi-, parking, carwash- and clothing costs, where the reimbursement for actual costs was related to costs which the employee had to make in her contacts with clients (restaurant costs, …). As the nature of both expense allowances was different, the flat rate allowance could not be considered covert pay in the opinion of the Labour Court of Appeal.

Impending Changes of Legislation: Belgium: The Work-Accidents fund and the Work-illness fund Merge As of 1 January 2017, both funds will merge into a new fund ‘Fedris’ or ‘Federal Agency for workrisks’. The purpose of the merger is to cut government expenses since the employees of both funds will be accommodated in the same building. Belgium: Interimcontracts will have to be signed before the start of work As of 1 October 2016, interimcontracts will have to be signed before the start of work. Under the old legislation, interimscontracts could still be signed two days after the start of work. This made abuse possible (for example: in some cases the interimworkforce had a work accident the first day of work due to which his/her employers did not want to sign the interim contract anymore). Now, such abuse is no longer possible. Belgium: Consensus on the concept of “heavy occupations” Employees in a “heavy occupation” can retire earlier than other employees. As the National Government is planning to make different changes to the pension legislation, a National Pension Committee was established. The National Pension Committee has agreed to split up the notion “heavy occupations” into 4 categories (stressful working conditions, stressful work organization, increased security risks and mentally or emotionally heavy tasks). However, for each category, specific criteria are to be defined by the social partners to determine whether or not a job falls under one of these categories.

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Latest Case Law: Summary of Recent Case Law in Canada i) The Court of Appeal found that a terminated employee was entitled to compensation for all losses arising from the employer’s breach of contract in failing to provide notice and that this included entitlement to a bonus. ii) The Supreme Court of British Columbia released a decision that serves as a caution to employers to be careful what they say to employees during the recruitment process. iii) A court in Ontario recently certified a class action in which 7,000 individuals have claimed that they were misclassified by a company as independent contractors when they were hired to perform door-to-door sales. The individuals have argued that they should be properly classified as employees, and receive the resultant incidents of employment. This is the first case of its kind to be certified as a class action in Canada.

Impending Changes of Legislation: Canada: New Obligations regarding Workplace Harassment New obligations came in effect as of September 8, 2016 for employers in Ontario with respect to workplace harassment under the Occupational Health and Safety Act (the “OHSA”).

Other Observations: Summary of Employment Law Observations in Canada i) The minimum wage in Ontario will be increased to $11.40 as of October 1, 2016. ii) The minimum wage in Saskatchewan will be increased to $10.72 as of October 1, 2016. iii) The minimum wage in Prince Edward Island will be increased to $11.00 as of October 1, 2016. iv) The minimum wage in Alberta will be increased to $12.20 as of October 1, 2016. The minimum wage for liquor servers in Alberta will be abolished on October 1, 2016. The Government of Alberta plans to increase the minimum wage to $15.00 by October 1, 2018.

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Latest Case Law: Chinese Court ruling on Employment Contracts Recently, after a cleaner was terminated by her employer, she filed a lawsuit against the company asking for a double payment of her salary, since the employer failed to set up a written employment contract. Nevertheless, the company contended that there is a collective employment contract concluded between the company and the labor union on behalf of all the employee. The company insisted that this collective employment contract shall be regarded as the written employment contract between the cleaner and the company. However, the court finally rejected such argumentation and concluded that a specific written employment contract between the company and the individual employee shall not be replaced by a collective employment contract.

Impending Changes of Legislation: China’s Enterprise Rating System will take effect January 1, 2017 The Measures for the Rating of Enterprises’ Labor Security Compliance Credit (the “Measures”) will take effect as of January 1, 2017. The Measures provide that all the administrative authorities of human resources and social security above county level shall be responsible for the rating of enterprises’ labor security compliance credit pursuant to the jurisdiction of labor security supervision. The enterprises will be rated as Grade A, Grade B or Grade C, the result of which will be recorded in the credit files of enterprise’s labor security compliance and be kept at least for three years. The enterprise rated Grade C will be treated as the key object under labor security investigation and thus subject to intensified daily perambulation inspections.

Other Observations: China issues 2016 Salary Directory Line So far, 11 places in China, such as Beijing, Tianjin, Sichuan and Shandong, have issued the 2016 salary directory line for their respective areas. Although the salary directory line is just an advisory guideline published by local governments instead of being mandatory law, it is meant to reinforce the local companies to increase the employees’ salaries reasonably, in consideration of the local economic situation. However, this year many of the aforesaid places actually lowered the salary directory line, implying that the speed of increase of employees’ salary may slow down in China in the near future.

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Latest Case Law: Summary of Recent Case Law in France 1) Consequences of the employer’s decision to postpone the meeting prior to dismissal due to the sick leave of a protected employee during his period of provisional suspension. 2) The fixed-rate indemnity due for violation of a protected status does not include the paid holiday indemnity. 3) An employer’s failure to take action when alerted to an employee’s work conditions is a breach of the duty of safety. Therefore, he was ordered to pay the employee damages for the damage suffered. 4) The assistant administrative and financial director of a Group’s main holding company may be delegated the power to sign the dismissal letter of an employee of a different company of the group.

Impending Changes of Legislation: Summary of Recent Legislative Amendments in France 1) A certificate of posting must be declared online as of 1 October 2016.2) Creation of a system of processing of personal data is authorized.

Other Observations: Summary of Employment Law Observations in France 1) Company-wide agreements in respect of working hours will prevail over the extended Collective Bargaining Agreement; it amends the rules for altering and terminating collective agreements, and entirely changes the law on collective bargaining. 2) Creation of automated processing of personal data to allow implementation of a personal account for preventing strenuousness. 3) Companies may provide in accordance with the CHSCT (Health and Safety Commission) or failing that, with the staff representatives and the occupational physician, ad hoc rooms for smokers and vapors. They must be equipped with a device to evacuate air by mechanical ventilation, have automatic closing doors and occupy no more than 20% of the total floor space of the establishment, without exceeding 35 m2.

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Latest Case Law: Germany: Invalidity of clause of forfeiture Pursuant to a judgement of the German Federal Employment Law Court as of 24 August 2016, a clause of forfeiture, which does not exclude an applicable minimum wage pursuant to the German regulation on Employee Posting, is invalid. It is not possible to waive the minimum wage pursuant to Sec. 9 of the German regulation on Employee Posting. Therefore, a general clause of forfeiture without any respective limitation is invalid. It is also not possible to “reduce” such an invalid clause to its legally valid content due to reasons of transparency. Germany: Inspection of the personnel file while having a lawyer present On 12 July 2016, the German Federal Employment Law Court ruled that there is no need for the employee to have a lawyer present while accessing his personnel file, when the employer allows him to make copies of his file.

Impending Changes of Legislation: Germany: Change of formal requirements for unilateral declarations of the employee In Germany, the regulation regarding the request of written form for (unilateral) notifications or declarations of the employees will change with effect as of 1 October 2016. Pursuant to a reform of the regulations on terms and conditions, any provision, which requests a stricter form than text form (email and fax is sufficient) from an employee is then no longer valid.

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Latest Case Law: India: Misappropriation of Funds When misconduct of misappropriation stands proved against the delinquent employee, reinstatement cannot be ordered. An employee holding a position of trust where honesty and integrity are inbuilt requirements of functioning, the matter should be dealt with iron hands and not leniently. When an employee is dealing with public money, highest integrity is expected out of the employee.

Impending Changes of Legislation: India: Amendments to Employees’ Compensation Bill 2016 (1) Increase of penalty for contravention of Act from present INR 5000/- to INR 50,000/- which may extend to INR 1,00,000/-. (2) Impose penalty for failure to display provisions of Employee’s. Compensation Act. India: Amendments to Maternity Benefits Bill 2016 (1) Increase the maximum period of maternity benefit from the existing twelve weeks to twenty-six weeks, in case of women who have less than two surviving children and in other cases, the existing period of twelve weeks maternity benefit shall continue. (2) To extend the maternity benefits to a “commissioning mother” and “adopting mother” and they shall be entitled to twelve weeks maternity benefit from the date of child is handed over…

Other Observations: India adjusts Minimum Wage The Central Government has fixed the INR 350/- per day as the minimum wages that has to be paid to lowest category of workers in the central sphere.

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Latest Case Law: Italian Court ruling on Protection for Part-Time Employees With reference to part-time employees, the Tribunal of Padova has ruled that the period of time when, according to their part-time contract provisions, the employees do not work, shall still be taken into account in calculating the length of service needed to qualify for a pension.

Impending Changes of Legislation: Italy: NCBA renewal On 21st July 2016, the renewal of the National Collective Bargaining Agreement for Managers of Commercial sector, was signed. It provides several changes, related to: supplementary indemnity, salary and notice period.

Other Observations: Italy: Public Sector Teachers Protest Teachers in the public sector are protesting at being transferred, following the new rules under the public labour reform.

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Latest Case Law: Luxembourg: Change of Service Provider – Transfer of Undertaking? Pursuant to EU and Luxembourg case law, the simple change of service provider by a company can entail the application of the TUPE regulations in place (and thus an automatic transfer of the employment contracts). A recent decision does however no longer highlight the aforementioned distinction and employers active in Luxembourg should be aware of the risk that, even if an activity is mainly asset based (rather than manpower related), Luxembourg courts tend to consider that the TUPE regulations should also apply if the new service provider takes over employees. In such a case, all in-scope employees’ employment contracts would then automatically be transferred to the new service provider and would either have to be (i) terminated or (ii) the employees granted the rights they had before during the relationship with the former service provider. Luxembourg: Protection of personal data – new Criminal Record Legislation From 1st February 2017 on, the employer’s right to request the presentation of a criminal record will be limited, pursuant to the new law of 23 July 2016. It will then be much more difficult for an employer to request a criminal record.

Impending Changes of Legislation: Luxembourg: Flexible Working Time System Introduced A draft law number 7016 on flexible working time arrangements was introduced on 27 July 2016. The current legal provisions will no longer be in force from 1st January 2017.

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Latest Case Law: Dutch Court ruling finds that Strikes during Peak Air Travel Periods are not Allowed Due to failed negotiations on a collective bargaining agreement, trade union FNV called a strike in August 2016 involving the ground staff of KLM. KLM and Schiphol subsequently claimed a ban on this strike in interlocutory proceedings, which claim was allowed on 26 August 2016. The question as to whether a strike is allowed is now only assessed on the basis of the aforementioned test whether a restriction of the right to strike is imperative from a social point of view, having regard to all the circumstances of the case. The rules of play can then be taken into account as one of such circumstances of the case. This new way of testing by the Supreme Court seems to offer more room for a strike than before. Nevertheless, the Amsterdam Court of Appeal judged on Friday 26 August 2016, that the strike of the KLM ground staff was unlawful. The reason for this is that the effects of the strike would be so far-reaching, that a restriction of the right to hold an industrial action is justified. To this end, particular consideration was given to the fact that a strike during peak times, due to the holiday period, would seriously disrupt air traffic, resulting in major consequences for Schiphol and the passengers: hours of additional waiting time for passengers including those in aircrafts that had landed already. On 6 September 2016, the parties reached an agreement in respect of a collective bargaining agreement as yet.

Impending Changes of Legislation: Netherlands: Paternity Leave Amendments Proposed A legislative proposal is pending that extends the number of days of paternity leave from 2 days to 5 days.

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Latest Case Law: Norway: Court ruling favors Employers in Downsizing Situations 35 workers were dismissed from their employment due to downsizing. Two workers brought an action claiming that the dismissal was invalid, partly because the seniority calculation was done incorrectly. The employer demanded that the plaintiffs should resign their positions while the case was pending. Based on the company’s difficult operating situation, the court found that the employer’s interest was predominant.

Impending Changes of Legislation: Norway seeks to Harmonize laws related to Civil Servants Government has issued for consultation a draft law on state employees. The law will replace the existing law and partly seeks a harmonization with the Working Environment Act. The draft law was sent to the Parliament for hearing.

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Latest Case Law: Poland: Dismissal on Disciplinary Grounds – Missed Deadline is Insignificant In case an employee was dismissed on disciplinary grounds and employer insignificantly missed the 1 month deadline to deliver a termination of contract, the court may dismiss an employee’s action in case recognition of claim would be unjust under specific conditions.

Impending Changes of Legislation: Poland: Remuneration of SOEs Executives As per the new Remuneration of Executives of State Owned Entities Act, parliament limited the amount of remuneration of executives of all SOEs. Currently, remuneration was limited only for companies owned by the State by 50% or more. Now, the threshold of ownership is removed. Remuneration will be divided into basic salary and additional salary.

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Impending Changes of Legislation: Portugal: Significant Changes to Labour Standards A recent legal act was approved and entered into force in Portugal introducing substantial changes to the existing legal rules on temporary agency work, “employee lease”, safety and health at work and liability for the infringement of labour standards regarding independent service subcontracting. The preamble of the new law states that these measures are meant to “fight modern-day means of forced labour”. In general terms, the new rules have established that all corporate bodies involved in temporary manpower agreements (temporary agency work), in service subcontracting and in temporary “employee lease” are personally and directly liability (as well as all entities that are in a control, group or reciprocal interest relationships with same entities) together with the actual employer company for all duties and credits that impede the employer towards employees, in any of the above referred cases (temporary agency work, “employee lease” and independent service subcontracting). The same responsibility is also extended to all directors, managers or board members of same entities.

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Latest Case Law: Romania: Collective dismissal is an objective procedure that may involve subjective criteria Recent court rulings on a collective procedure involving 600 employees recognized the employer’s right to use subjective criteria as part of the objective procedure in order to determine the employees that are going to be dismissed. Although the procedure needs to be as objective as possible, sometimes using only objective criteria in order to select the employees that are going to be dismissed is not enough.

Impending Changes of Legislation: Romania: Individuals can pay to cover missing contributive period in order to benefit from state funded pension A recent legislative measure created the legal frame for individuals that do not meet the legal requirements for the contributive period in order to benefit from state funded pensions and want to benefit from such pension.

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Latest Case Law: Summary of Recent Case Law in Russia 1) Novosibirsk region court decided that the death of the employee from overtime work (employee’s burn-out) shall be deemed a workplace accident. Thus, all rules of workplace accident formalization, insurance and payment shall be observed by the employer. 2) Nizhegorodsky region court stated that in case the dispute between the company and its contractor – physical person on actual labor relationships between them is lost by the employee, the company has the right to reimburse its court costs from the employee as it is not a labor dispute. Under the general rule, employers have no right to reimburse their court costs from the employees in labor disputes. 3) Moscow city court stated that prolongation of the fixed-term employment agreements does not, per se, mean that the employment relationships are concluded for an indefinite term. The employee has to prove other features of indefinite term employment relationships. 4) Russian Supreme court declared that it is illegal for the state labor inspectorate to fine the companies in case they pay the fist part of the salary in the current month and the second part of the salary for the actually worked period in the next month. From 03.10.2016, the respective amendments in the RF Labor code are entering into force.

Impending Changes of Legislation: Summary of Legislative Changes in Russia 1) Ministry of Labor will prepare the List of Persons Dismissed due to Loss of Confidence. 2) Standard form of the Employment Agreement is Established. 3) New Rules of Employee’s Medical Checkings.

Other Observations: Summary of Employment Law Observations in Russia 1) 22% of Russian Companies Employ Distant Workers. 2) According to the official statistics of the Russian Ministry of Labor, the general number of dismissals for the 1st half of 2016 decreased in comparison with 2015 by about 5%.

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South Africa

Latest Case Law: South Africa Court ruling Clarifies Unlawful Dismissals In a recent case, the Labour Court, again dealing with the issue of allegedly invalid/unlawful dismissals, makes it clear that the fact that a dismissal may be invalid does not mean in itself that a dispute in relation to that dismissal is urgent. Referring to, and clarifying the judgment in the SABC case, the Labour Court states that, while it is possible to bring a claim of an invalid dismissal to the Labour Court, if litigants wish to do so on an urgent basis, they have to make out a proper case for the urgency of their matter (as they would have to do with any other claim).

Other Observations: South Africa: Car Manufacturers and Unions reach 3-year Wage Deal Car manufacturers have agreed to a three-year wage deal with trade union, NUMSA, following successful wage negotiations which took place without any disruptions or work stoppages. The focus has now shifted to the retail motor industry, where wage negotiations are reaching their final stages.

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Latest Case Law: Spain: Paid Leave A new National Audience’s (NA) ruling on paid leave states when the paid leave must be enjoyed if it occurs on a non-business day. This matter is stated in the Collective Bargaining Agreements (CBA) since the Workers Statute does not mention it. The NA was precise in this respect, that the rules laid down in CBA resulting from the negotiated will of the representatives of the company and employees and that its provisions must be respected unless infringe any superior rule, which in the present, case does not occur. In addition, the NA considers that it is not contrary to the rules of logic, the requirement that the days of paid leave are enjoyed on the date that the situation causing it takes place and may not be transferred to immediate business days.

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United Arab Emirates

Impending Changes of Legislation: Summary of Legislative Changes in the UAE The Ministry of Human Resources and Emiratisation, formerly the Ministry of Labour (the Ministry), has recently issued a string of new ministerial resolutions and decrees designed to address gaps in the employment regulatory framework and reinforce existing legislation affecting employers falling under the Ministry’s jurisdiction: Ministerial Resolution No. 591 of 2016 was issued on 30 May 2016 and obliges employers with more than 50 employees, earning a gross monthly wage of less than AED 2,000 (pursuant to the Wage Protection System), to provide accommodation to those employees; Ministerial Resolution No. 713 of 2016 enables students between the ages of 12-18 years to work and train in the private sector; Ministerial Decree No. 739 of 2016 with regards to the UAE Wage Protection System.

Other Observations: Maternity Leave Amendments under consideration in the UAE The UAE government recently set up a committee to review and revise the maternity law in order to support the role of women in the workplace and close the gender inequality gap. The Labour Law currently entitles a working woman to 45 days maternity leave with full pay which includes the period before and after the delivery, provided that she has one year’s continuous service. Maternity leave is granted with half pay if the woman has not completed one year of service. In addition to the 45 days’ paid maternity leave entitlement, a female employee can take a maximum of 100 (consecutive or non-consecutive) days’ leave, without pay, if she suffers from an illness resulting from pregnancy or birth and, as a result, is unable to resume work.

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United Kingdom

Latest Case Law: UK court concludes that expatriate manager in Bangladesh may bring employment tribunal claim in GB An expatriate teaching centre manager working in Bangladesh for a UK non-departmental public body was entitled to bring claims for unfair dismissal and under the Equality Act 2010 in an employment tribunal in Great Britain as his employment had an overwhelmingly closer connection with Great Britain and with British employment law than any other system. UK court rules in disability discrimination claim that reasonable adjustment cannot be imposed without employee’s consent An engineer whose responsibilities were reduced because of his disabilities could not have a pay cut forced on him. A reasonable adjustment for disability, which was incompatible with the terms of the employment contract could not be imposed by an employer and would only be effective with the employee’s consent. There was no reason in principle why pay protection, in conjunction with other measures, could not be a reasonable adjustment – the question would always be whether it was reasonable for the employer to have to take that step.

Impending Changes of Legislation: UK: National Minimum Wage Draft Approved The House of Lords has approved the draft National Minimum Wage (Amendment) (No.2) Regulations 201, which will increase the various rates of the NMW. The new rates will apply from 1 October 2016.

Other Observations: UK: Tax on Termination Payments Proposed The government has unveiled its draft legislation, setting out how it plans to simplify and tighten the rules on the taxation of termination payments. The changes are expected to come into force in April 2018.

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United States

Other Observations: USA: Updated EEOC Retaliation Guidance Suggests Scrutiny for Internal Investigation Practices The U.S. Equal Employment Opportunity Commission (EEOC) has taken an expansive position on the protection given to persons who make internal complaints about discrimination in bad faith in updated guidance on retaliation law. While the guidance is the EEOC’s interpretation of the law, which may or may not be accepted by any particular court, many of the points made by the EEOC in its updated guidance are widely accepted by the courts. In addition, EEOC investigators will no doubt follow the guidance when evaluating charges filed with the agency.

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