Employment Law Updates for October 2016

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

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Employment Law Tracker

 

Belgium

Latest Case Law: Belgium: The stakes may be high when an employee is fired for serious cause In a recent case, a shop manager was fired for serious cause, as she did not comply with the store policies. However, the Labour Court judged that the facts at hand did not justify a dismissal for serious cause. As a result, the Labour Court condemned the employer to pay the employee the legal termination indemnity. The Labour Court also condemned the employer to an indemnity for unjustified dismissal of 17 weeks’ salary. In the past, it was rather difficult for (white collar) employees to obtain, in addition to the legal termination indemnity, damages for unfair dismissal, of which, the relatively low amount was often set by the judge. However, things have changed since 1 April 2014, and the employer is obligated to duly motivate the dismissal under penalty of an indemnity ranging from 3 to 17 weeks’ salary.

Impending Changes of Legislation: Belgium: Changes to the rules regarding collective dismissal are expected As a consequence of a recent wave of restructurings and therewith associated collective dismissals, the Federal Minister of Work intends to adjust the legislation on collective dismissals and has submitted in that regard 5 measures to the social partners for discussion. These measures will be discussed among the social partners and counter-proposals are expected. There is currently no deadline in that regard. Belgium: The payment of salary must be executed by bank transfer As of 1 October 2016, an employer is obliged to pay the salary of the employee by bank transfer. Payment in cash is only allowed when a collective bargaining agreement at sector level is concluded, which allows such payments or when an implicit agreement or use was officially formalised.

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Canada

Latest Case Law: Summary of Recent Case Law in Canada i) A recent decision from the Human Rights Tribunal of Ontario found that there should not be a different test for discrimination with respect to the protected ground of family status. ii) The Quebec Superior Court recently awarded damages to an employee for stress and anxiety associated with the early termination of a fixed term contract. iii) The British Columbia Court of Appeal recently held that it was not appropriate to award damages against an employee for his failure to provide notice prior to his resignation.

Impending Changes of Legislation: Canada: New Bill Seeks to Protect Individuals that are not Traditionally Considered Employees The Government of Ontario is currently considering a bill to provide certain protections to individuals that are deemed to be employees under the ESA, even though they would not otherwise meet the definition of an employee under the Act. If the bill is passed, individuals receiving training, secondary school students performing work under a work experience program, and individuals performing work under a program approved by a college or university would be deemed to be employees for certain purposes, including time off on public holidays, vacations without pay, and filing complaints with the Ministry of Labour.

Other Observations: Summary of Employment Law Observations in Canada i) The Federal Government recently announced a public consultation, which will be open until February 2017, with respect to developing federal accessibility legislation. ii) The New Brunswick Government is seeking feedback with respect to proposed changes related to the statutory minimum wage, employment protections for young workers, and coverage under the Employment Standards Act.

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China

Latest Case Law: China: Employers cannot withhold fees from Employee’s salaries for donations without Consent In a recent case, the employee, Mr. Xu, discovered that, after leaving the company, his employe had withheld part of his salary without his approval, and Mr. Xu asked for the repay of the corresponding portion. The company contended that it would withhold 1 RMB from every employee’s salary every month and that amount of money would later be donated to charity utility by the trade union. The court concluded that donation shall be subject to every employee’s own consent and the company shall not withhold any part of the salary without the employee’s prior consent.

Impending Changes of Legislation: China: New Measures to Protect against Labor Violations to take Effect in January 2017 On September 1, 2016, PRC Ministry of Human Resources and Social Security promulgated the Measures for Publicizing Acts in Material Violation of Labor Security Laws (hereinafter referred to as the “Measures”), which will come into effect as of January 1, 2017. Article 5 of the Measures specifies that the seven kinds of material violations of labor security laws shall be disclosed to the public.

Other Observations: Measures proposed to Streamline Foreigners Working in China The State Administration of Foreign Experts Affairs of PRC will implement the Pilot Program on Employment Permission for the Foreigners Working in China in the near future, aimed at establishing a unified administration and service system for foreigners working in China.

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France

Latest Case Law: Summary of Recent Case Law in France i) Although two staff members in the same company may perform the same tasks, the employer may nonetheless afford them different remuneration, should the cost of living in one of the two geographical areas be markedly less than the other; ii) The initiative for setting up stand-by (on-call) arrangements may not be taken by the staff members alone; iii) A suit filed by the Works Council will not serve to postpone the cut-off point for ending consultation; iv) Should the employer consult the company’s Health & Safety Committee (CHSCT) on a voluntary (i.e. non mandatory) basis further to irregular arrangements, said irregularity will not justify striking down approval of the Plan de sauvegarde de l’emploi; v) Maternity: where the employer dispenses an employee just back from maternity leave from performing tasks while still being remunerated for them, this does not postpone the launch-date for the statutory protection subsequent to the end of maternity leave; vi) Should the company’s circumstances so justify, the purview of a Works Council’s droit d’alerte may be broadened to include the parent company; vii) Electronic ballots in staff elections: reliance upon codes forwarded via a business e-mail address, may suffice as a guarantee that the data remain confidential; viii) Resettlement offers abroad must be translated into French.

Impending Changes of Legislation: Summary of Recent Legislative Amendments in France i) As of 1st January 2017, the rules will be relaxed in relation to the duty to put a cloakroom and space for meals at the workforce’s disposal; i) For the year 2017, the Social Security cap will likely be 39,228 €.

Other Observations: France: Adjustment to the Attachment of Earnings Since 1st September 2016, the part of wages that may not be attached is 535.17 Euro.

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Germany

Latest Case Law: German Court rules that Maternity Pay applies Before Employee Starts Working A recent court case held that an employee may claim maternity pay from the employer, even though she has not yet started to work in her employment relationship, since the statute does not regulate the necessity of a specific length of service before claiming such rights. Please note however, that the amounts to be paid by the employer can be reimbursed by an apportionment procedure from the health insurance of the employee. Germany: Signature of Job References A recent court case held that even smaller businesses, with only a few employees, may delegate the signature of a job reference to an employee of the HR department. Please note however, that in such a case, it is necessary that the kind of representation and the function of the person

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India

Latest Case Law: India: Court clarification on Industrial Disputes Act i) the jurisdiction of the forum court is a limited one; ii) the order of discharge or dismissal, as passed, is liable to be challenged before the Industrial Tribunal under the Act; iii) dismissal from service of a driver is justified if he caused the accident due to rash and negligent driving, resulting in the death of 1 person and injuries to 9 persons; iv) when damage caused on account of the accident itself proved that the accident took place due to rash and negligent driving by the workman-driver, not examining an eyewitness or not cross-examining the defence witnesses, are not grounds to vitiate the enquiry; v) while justifying a dismissal order, the past record, indicative of similar departmental actions on several occasions, is an appropriate form of supporting evidence; vi) If material placed on record by the management in a departmental enquiry indicates (prima facie) that the fatal accident took place, the burden of disproving the accident would shift upon the delinquent driver, by proving that the accident took place due to some cause other than his own negligence.

Impending Changes of Legislation: India: Proposed Amendments to Employees’ State Insurance Rules Employees’ State Insurance (Central) Amendment Rules, 2016, proposes to include the following changes: i) The definition of ‘insured woman’; ii) The number of weeks for maternity benefit is to be increased from 12 to 26 weeks.

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Italy

Latest Case Law: Italian Court grants Employers the right to Verify Employee’s Sickness An employer is entitled to verify whether or not the employee on sick leave is actually sick, even when the employer has no reasonable grounds to suspect that the employee is not actually sick.

Impending Changes of Legislation: Italy: Amendments to the Jobs Act The Government has made several changes to the Jobs Act, editing provisions related to mandatory pre-communication for the utilization of vouchers, mandatory hirings of disabled employees and solidarity contracts.

Other Observations: Italy: Company Level Welfare Authors are debating whether to pass a law on company level welfare, which could increase employee productivity, thus improving performance.

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Mexico

Latest Case Law: Mexico’s Supreme Court rules on Trustworthy Employees’ Right to Strike Trustworthy employees cannot participate in or exercise the right to strike, because they represent the interests of the party holding capital in labor relations and, as such, it would be a contradiction that they sought the balance between the production factors from the person they embody and represent, because it would invariably go against the employer’s will and the company itself would be affected. Mexico’s Supreme Court Resolves the Applicability of the Rules for Calculation on Back Wages The rules for calculation of back wages apply only to proceedings started on December 1, 2012 or afterwards, even when the dismissal occurred before that date and provided that the statute of limitations of 2 months, for the employee to initiate a labor action, goes beyond it. This, because the employee’s right to receive back wages arises on the resolution determining that the separation was unjustified. Mexico’s Supreme Court Resolves the Verisimilitude of Overtime Pay claimed by Employees working Continuous Shifts When an employee who worked overtime in a continuous shift claims such payment, but fails to precisely detail the time scheduled for rest and meals, this does not necessarily make his claim improbable. Thus, it is lawful for the Labor Boards and the Courts of Appeal to study the objectivity of the employee’s arguments regarding the overtime s/he alleges to have worked.

Impending Changes of Legislation: Mexico: Senate approves Constitutional Reforms to Labor Proceedings The Mexican Senate approved a number of amendments to Article 123 of the Constitution, which regulates labor matters. In order for these constitutional reforms to be effective, it requires the approval of the House of Representatives and the approval of the majority of the local Congresses. If approved, it will be sent to the Executive Branch for its enactment. Mexico’s National Health and Safety at Work Consultative Committee updates the Valuation Table for Permanent Disabilities The Valuation Table for Permanent Disabilities sets the percentages applicable per type of suffering derived from work hazards and illnesses. The Table is addressed to the specialists of the Mexican Institute of Social Security, who will determine the percentage of disability and salaries to be paid by the employer.

Other Observations: Mexico’s Ministry of Labor and Social Welfare presents the Protocol to Prevent Work Violence Addressed to all companies doing business in Mexico, the Protocol to Prevent Work Violence, Harassment, and Social Harassment is intended to be an instrument to diminish the impact on employees’ health at the time it increases productivity, with the goal of creating a fair labor environment.

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Netherlands

Latest Case Law: Dutch Court rules on Salary Payment Protocol for Employees on Sick Leave Employers are obliged to continue to pay the salaries of sick employees for the first two years of illness. However, in case – for instance – an employee does not comply with the rehabilitation obligations of the employer, an employer may (under certain circumstances) discontinue the payment of salary. In a recent case, the court ruled that the employer was not entitled to discontinue the payment of salaries because (1) this letter did not include an explicit warning to the employee that the payment of salary would be discontinued if the employee was not going to meet her rehabilitation obligations, and (2) nor was this warning (verbally or written) promptly given at any time. Solely referencing the applicable statutory provisions is not sufficient. Please note that such warning letters must be narrowly worded.

Impending Changes of Legislation: Netherlands: Works Councils granted additional Rights of Consent A works council now has the right of consent with regard to an intended decision by the entrepreneur in respect of determining, modifying and cancelling a pension agreement, regardless of where this pension agreement is placed. Formerly, the works council had this right of consent only in case the pension provider was an insurance company.

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New Zealand

Latest Case Law: New Zealand: Refresher on the Use of Fixed Term Contracts A New Zealand Teaching Association (union) has claimed that employees are being “forced” to accept fixed term contracts. The Teaching Association reports that only 15% of new teaching graduates are being employed in permanent positions, with many schools relying on fixed term contracts as a way to manage funding from year to year or to “trial” new teachers. In New Zealand, fixed term employment contracts can only be used where an employer has a genuine reason based on reasonable grounds for limiting employment to a fixed term. The consequences of not complying with the requirements for a fixed term contract are that if an employee challenges his/her termination, the employer is not able to rely on the fixed term to justify that employee’s termination. The practical effect of this will be that the employee relationship is permanent, and the employer could be ordered to pay compensation for an unjustified dismissal or to reinstate the employee.

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Norway

Other Observations: The Longest Hospital Strike in Norway’s History Finally Comes to an End Doctors, economists and lawyers employed at hospitals went on strike on 7 September 2016. The workers had been negotiating with hospital management concerning working hours, and especially the working hours for the doctors, but did not reach an agreement. 628 members of were on strike in 15 different hospitals. On 11 October 2016, Labour Minister Anniken Hauglie of the Conservative Party, ordered an end to Norway’s longest hospital strike ever due to the concern that the hospitals could not provide sufficient medical assistance. All striking doctors and other medical professionals were ordered back to work immediately and the dispute must now be settled through compulsory arbitration.

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Romania

Latest Case Law: Romania: Clarification on Notification Process involving the National Council for Fighting Discrimination The National Council for Fighting Discrimination has issued a series of rulings in employment related matters, including one stating that the marginalization and dismissal of a person who had previously notified the NCFD on grounds of maternity is discrimination, victimization and violation of the right to dignity, according to national law.

Impending Changes of Legislation: Romania: Plenary Debates continue on Labour Code Reform Talks between the working committee and representatives of both the employers’ and employees’ organizations have led to a series of amendments made to the form that was adopted by the Senate earlier this year. Plenary debates are expected to take place until the end of this year. Even if there is no clear information about the final form of the new law at this moment, it is certain that the changes will have a significant impact.

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Russia

Latest Case Law: Russia: Justification of Labor Inspectorate Prescriptions Before making a complaint to a supervisory (higher instance) court, all the previous official stages must be followed. Thus, it is impossible to immediately make a claim in a supervisory court without first passing through a lower court. Russia’s Supreme Court alters Method of imposing Administrative Fines on Employers Over the past few years, representatives of the state labor inspectorate noted that for 1 mistake in 100 employment agreements, a company could be fined 30,000 RUB (minimum fine for one breach) multiplied by 100. Now, the Russian Supreme Court has changed its view concerning the method of imposing administrative fines on employers for breaches of labor law. Similar breaches of law (e.g., delay of salary payment for 100 employees) shall entail one fine. At the same time, when an employer delays both the wages and interest for the delay, there are two different breaches and consequently two fines. Russia: Pregnant Woman may Annul Her Application or Agreement for Termination The Russian Supreme Court stated that a pregnant woman has the right to annul her application for termination of employment agreement by her own will at any stage (even after dismissal) if she did not know about the pregnancy. Also, a pregnant woman may unilaterally annul the mutual agreement for termination in case she did not now about her pregnancy when signing the agreement.

Impending Changes of Legislation: Amendments to Russia’s Labor Code It will soon be possible to combine the modes of short working day and short working week. Overtime work within public holidays would then be paid as either overtime work or work on public holidays only (double payment excluded). In case a part of an employee’s shift takes place during a public holiday, and another goes beyond it, the employer would pay a double amount only for the first part of the shift.

Other Observations: Russia: Statistics on Employer Compensation According to the results of the interviews with employers, companies now reduce benefits for their employees. For example, 5% of the companies have ceased to pay additional trainings, and 6% – transport fees. 7% of companies excluded gyms and swimming pools from their compensation packages. Companies allow discounts on their products instead. Remarkably, the number of companies that keep additional health insurance for employees remains the same (24%).

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Saudi Arabia

Impending Changes of Legislation: Saudi Arabia: New Programme to address concerns regarding Saudi nationals As part of Vision 2030, the Ministry of Labour has announced the implementation of the ‘Weighted Nitiqat’ programme, which is designed to address concerns regarding the level of roles Saudi nationals are being engaged to do. Under the new system, there will be five criteria according to which an employer’s compliance rating will be decided upon and points will be awarded to those employers that reach the criteria.

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South Africa

Latest Case Law: South Africa: Court ruling on Harassment in the Workplace Harassment in the workplace in South Africa is primarily regulated by the Employment Equity Act (EEA), which categorises the harassment of an employee as a form of unfair discrimination. However, a recent judgment indicates that claims of harassment can also be brought under a more recent piece of legislation, namely the Protection from Harassment Act (the Harassment Act). The significance of the case is, firstly, that it indicates that employees who experience harassment in the workplace that may not qualify as unfair discrimination under the EEA (e.g. if the harassment is not due to race, gender or some other ground of discrimination), could potentially obtain a remedy under the Harassment Act instead and, secondly, a single act is unlikely to qualify as harassment (under the Harassment Act at least).

Impending Changes of Legislation: South Africa: Bill proposes to modify Parental Leave A private members bill has been tabled in Parliament, which contains a proposal to afford 10 days of paid parental leave to employees (either male or female) on the birth of their child or in the case of adoption or surrogacy. The proposed amendment is also aimed at catering for

Other Observations: South Africa: Wage Negotiations in the Retail Motor Industry The wage negotiations in the retail motor industry are coming to a head. As things stand, following unsuccessful negotiations between the dominant union in the industry, the National Union of Metalworkers South Africa (NUMSA), and the Retail Motor Industry Organisation (RMI), NUMSA could give the retail motor industry 48 hours’ notice of its intention to strike over its demands in relation to, amongst others, wage increases for the next three years.

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Spain

Latest Case Law: Spain’s Supreme Court rules on Permanent Seasonal Contracts and Temporary Invalidity The issue was whether the employer had the obligation to make a call to a permanent seasonal employee, who was in a temporary invalidity situation and then report said employee to the social security system. The court held that the employee’s illness did not exempt the employer from the obligation to call and report the employee to the social security system; without prejudice to then take the leaving on social insurance for temporary invalidity and to hire temporary employees, if appropriate.

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United Arab Emirates

Impending Changes of Legislation: Summary of Legislative Changes in the UAE i) Imminent Decree: A new decree is expected to be published, which will benefit government employees in the emirate of Abu Dhabi. The decree is expected to increase maternity leave, increase paternity leave and entitle female employees nursing their babies to two hours of additional break each day for a period of one year from the birth of their child. The new decree is also expected to provide for enhanced rights for people with disabilities. ii) Wage Protection System: The UAE Wage Protection System is now being implemented by the Ministry of Human Resources and Emiratisation and is considered to be in force as of 3 October 2016.

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United Kingdom

Latest Case Law: UK court rules that commission and non-guaranteed overtime must be included in holiday pay An energy trader was entitled to be paid as if he was earning his usual commission when he took the first four EU mandated weeks of his annual leave. The Court of Appeal confirmed that commission and non-guaranteed overtime are still the only payments that employers must include in holiday pay. UK court concludes that activities were fundamentally the same before and after TUPE service provision change A recent ruling held that to assess whether activities were fundamentally the same before and after the transfer, they had to be defined in a common sense and pragmatic way – not at such a level of generality that they did not really describe the specific activities at all – but having regard to the evidence in the round.

Impending Changes of Legislation: UK: First Draft of Apprenticeship Levy (tax) Published A first draft of the regulations implementing the apprenticeship levy i) provides that employers fall within the levy if their total payroll exceeds £2.8 million in the previous tax year, or is expected to reach £3 million in the current tax year; and ii) sets out the information that employers must provide to HM Revenue & Customs concerning the levy.

Other Observations: UK: Inquiry on Corporate Governance Launched An inquiry on corporate governance has been launched and will focus on executive pay, directors’ duties, how to increase the number of women in executive positions on boards as well as worker representation on boards and on remuneration committees.

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United States

Other Observations: USA: Pay Data Changes Published The U.S. Equal Employment Opportunity Commission (EEOC) has issued revisions requiring employers with at least 100 employees to submit annual EEO-1 reports that include W-2 pay and hours worked data for their entire workforces, nationwide. Employers are advised to begin preparations now, starting with pay analyses to identify and address pay issues that could emerge from the EEO-1 pay data and arise in systemic investigations by EEOC or the Office of Federal Contract Compliance Programs (OFCCP).

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