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Evidence Act: Stricter conditions for employment contracts

18Aug

The revised Evidence Act tightens the conditions for the content of written employment contracts or working conditions communicated in writing by the employer to the employee. We have summarised here which new conditions employers should prepare for in the future.

What new requirements does the Verification Act impose?
As of 1.8.2022, the new Evidence Act obliges employers to include additional information in writing in the employment contract or to provide it in writing in addition to the employment contract. The most significant impact of the Evidence Act is on the following information in the employment contract:

- About the procedure in the event of dismissal: In particular, employees shall be informed in writing of the time limit to be observed for bringing an action for protection against dismissal. If the employer does not inform the employee in writing of the time limit, this shall not, however, result in the employee's failure to observe the time limit being harmless.
- On the composition of remuneration, including the amount of overtime pay, allowances, bonuses and special payments, as well as their due date and method of payment
- On the location and extent of rest periods 
- On the conditions for ordering overtime

In some places, the new conditions in the Evidence Act are unfortunately not clear. For example, the provision of information on the dismissal procedure in the employment contract becomes mandatory. However, the Evidence Act does not say what specific information is required. It is obvious, for example, that a reference to the written form of the notice of termination and the time limit for bringing an action is required. It is not clear whether and to what extent the Verification Act requires information on the participation of co-determination bodies or certain authorities in the employment contract. 

There is therefore legal uncertainty. For the precise naming of all conditions of the Evidence Act, the classification by case law must be awaited. The challenge for employers is increased by the introduction of administrative offences for violations. Violations of certain provisions of the Verification Act can for the first time be sanctioned with a fine of up to €2,000 per violation.

What advice should employers take in dealing with the new Evidence Act?
In the presentation of the concrete conditions for the future design and implementation by employers, the same standards were unfortunately not applied - as the draft law reads - as in the design of the provisions on fines.

We therefore recommend a conscientious review and adaptation of the standard employment contracts used so far. At the same time, we advocate proceeding with a sense of proportion and keeping the processes in the HR department as practicable as possible. Despite the upcoming challenges posed by the new verification law, we are confident that this can be done well.

Written form is not everything - further changes in labour law
The whole of Germany is talking about the Verification Act. The significant changes to the written form requirement for certain terms and conditions of employment quickly make one forget that there are also other relevant changes to the law. Particularly significant are some changes in the Part-Time Work and Fixed-Term Employment Act, the Temporary Employment Act and the Trade Regulation Act. The regulations apply from 1.8.2022.

Amendments to the Part-Time Work and Fixed-Term Employment Act 
- In fixed-term employment relationships, the probationary period may no longer be a flat six months, but must be in proportion to the duration of the fixed-term and the type of work.
- Employers are generally obliged to inform their employees about jobs to be filled in the company. An employee who asks the employer to reduce the term of his fixed-term employment contract or to change the location or duration of the contractually agreed working hours must be answered by the employer in text form. This only applies if the employment relationship has already existed for longer than six months and the employee has made the request in text form. Text form means: in a readable format on a durable medium - e.g. by e-mail. The employer has one month from receipt to reply to such requests.
- If there is an agreement that the employee has to perform work according to the workload ("work on call"), so-called reference days and reference hours must now be determined. The employer must specify certain days and time windows within which work can take place at the employer's request. The employer must notify the employee of work assignments at least four days in advance, otherwise the employee is not obliged to perform the work.

Changes in the Temporary Employment Act
- Hiring companies are now obliged by law to inform the temporary worker of the name and address of the hirer in text form.
- If a temporary agency worker expresses in text form the wish to conclude an employment contract with the hirer, the hirer is obliged to provide the temporary agency worker with a reasoned reply in text form within one month of receipt of the letter. The prerequisite is that the temporary agency worker has been assigned to the hirer for at least six months.
- Amendments to the Trade, Commerce and Industry Regulation Act (GewO)
- A provision has been included in the Trade Regulation Act according to which employers who are obliged by law, collective agreement or works or service agreement to offer the employee further training necessary for the performance of work may not charge the employee for the costs of such training. Moreover, such training should be provided during regular working hours or at least be considered as working time.

We are happy to support you in being well positioned for the future drafting of employment contracts. Get in touch if you have questions about the Evidence Act or the other changes in labour law and would like our advice.