Information Obligations (Employment Contracts)
by Gregor Thüsing and Sally Horler
1. The law as it stands
With regard to proof of work conditions (conditions of employment (information)), Directive 91/533 on an employer’s obligation to inform employees of the conditions applicable to the contract or employment relationship contains the requirements laid down by European law. The essential content of the directive is that every worker must be provided with a written document from which he can ascertain the ‘essential aspects of the employment relationship’ (Art 2(1) in conjunction with Art 3 of the directive). Some Member States already had regulations regarding employers’ information duties, and it was thought necessary to harmonize this area throughout the European Union. The background to this development was the fact that it was felt that the transparency of the employment market and of work conditions was being threatened by the development of a multitude of new forms of employment (telework and standby work, job sharing and job splitting), and it was hoped to counteract this development by introducing new information obligations. In addition, it was feared that workers’ mobility would be endangered (free movement of workers). Thus, it was decided that a general duty to give every employee a document containing the essential terms of his employment relationship shall be implemented at Union level. Such a directive made sense considering the possibility, not only in Germany but in many Member States, of concluding oral contracts of employment.
The idea of regulating proof of work conditions was not invented by the European legislature, but rather has its origins in the form and proof requirements adopted by individual Member States as early as the 1970s. The English and Irish laws in particular were pioneers in this area and served as the models for the ensuing European regulation. Section 1 of the British Employment Protection (Consolidation) Act 1978 obligated the employer to give the employee a written statement of the essential conditions of the employment contract. The Irish Minimum Notice and Terms of Employment Act 1973 contained a very similar provision in s 9. In France, too, there was an obligation to provide proof in that the pay slip (bulletin de paie) had to include certain information about the contract conditions such as the particulars of the parties. In Germany and in other Member States such as Portugal and Greece on the other hand, this development found no followers. There, general requirements of proof were unknown, and proof was only prescribed by law in exceptional cases, eg for temporary work.
Owing to these differences in the laws of the Member States, the Commission saw the need for a Europe-wide harmonization. On 18 October 1991 this was adopted as the so-called Employee Information Directive. Just like the national laws which were the catalyst for adopting the directive, its aim is to provide the employee with information about his rights. By handing over a written document from which he can ascertain the terms and conditions of his employment contract, he is able to keep track of his rights and duties even in a flexible world of employment. Additionally, putting contract terms in writing increases legal certainty and prevents difficulties in proving an employment relationship. As the directive primarily has the protection of the employees in mind, the Member States may only derogate from the directive in their favour (Art 7 of the Employee Information Directive).
Directive 91/533 was the beginning of a number of Community measures that aimed to improve the information of employees. This policy area is among the greatest progressions of European secondary law and the acquis has taken on a considerable dimension. The measures that followed, however, were more concerned with collective employment relationships rather than individual employment relationships, including Directive 94/45 concerning the establishment of European Works Councils, Directive 2001/86 on the involvement of employees in the European Company (Societas Europaea) and Directive 2002/14 concerning the consultation and information of employees in particular. This development is based on the acknowledgement that employee rights need to be strengthened to contain the market forces unleashed by the ever-progressing economic integration of the Community.
2. Implementation in the Member States
Pursuant to Art 8 of Dir 91/533, the directive had to be transposed into national law by 30 June 1993. The German legislature, in the absence of a Labour Code, implemented the Employee Information Directive by means of the Nachweisgesetz in 1995. Similarly, Denmark and the Netherlands also decided to enact a separate piece of legislation in order to implement Dir 91/533. English and French law merely needed to adjust their existing regulations (Art R-1221-1 ff Code du travail and s 1 Employment Rights Act 1996). The implementation acts of each Member State are available at <http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:71991L0533:EN:NOT>. An extensive implementation report by the Commission is available at <http://ec.europa.eu/social/main.jsp?catId=706&langId=en&intPageId=202> .
3. Scope of application
Pursuant to Art 1 of the Employee Information Directive, this directive applies to every paid employee who has a contract or employment relationship defined by the law in force in a Member State and/or is governed by the law in force in a Member State. This wording has lead to interpretation problems. The application of the directive is, at any rate, subject to the condition that the contractual relationship, the conditions of which are to be verified, is an employment relationship. As to the definition of employment contract or employment relationship the directive seems to refer to the law of the Member States (Art 1(1): ‘employment relationship defined by the law in force in a Member State’). This is also the opinion of the European Commission.
This is not in fact the case, and this is made clear by the fact that the directive applies specifically to employment relationships that are not defined by the law of a Member State. Pursuant to the wording it suffices that an employment relationship is governed by the law in force in a Member State; it is not necessary for it to also be defined by the law of the Member State (‘and/or is governed by the law in force in a Member State’). Were one actually to apply the national definition of employment relationship, then the second alternative of Art 1(1) would lose all meaning. If an employment relationship within the meaning of the directive can only be an employment relationship as defined by national law, then the first alternative will always apply in any event, and no scope of application will remain for the second alternative. It follows that the directive’s definition of an employment relationship cannot be congruent with that of national law.
There are two interpretation possibilities which would give the second alternative an independent scope. One must either assume that the legislature acted on the assumption that there is an autonomous European definition of an employment relationship which would include those which would not constitute an employment relationship under national law but would constitute an employment relationship pursuant to the autonomous European definition and would therefore be governed by the law of a Member State, or one must conclude that the second alternative serves to include employment relationships which are subject to the laws of foreign states as long as they are otherwise governed by the laws in force of a Member State. This, however, would mean dividing the law applicable to the employment relationship into one legal order that governs the existence of an employment relationship and another legal order that governs the rest of the employment relationship. There is no evidence of such a division being intended. Therefore, the correct supposition is that the second alternative has its own scope of application only if it is assumed that the directive applies to employment relationships as defined by the Member States or to those under the autonomous European definition and governed by the laws of a Member State. In this respect, the second alternative is relatively straightforward. It is consistent with the Commission’s first draft proposal. It encompasses all contractual relationships that are considered employment contracts under European law and are governed by the law of a Member State.
In contrast, the meaning of the first alternative is less clear. It is obviously meant to separate the scope of the directive from the proper law of the contract. In principle, the contracting parties to an employment contract are free to choose the proper law of the contract. With that, workers can take up employment in Europe without being governed by the law of a Member State and that of the European Union. Under the draft proposal they would also not have fallen within the scope of the directive. The legislature obviously wished to prevent this by adding the alternative ‘defined by the law in force of a Member State’. The directive also applies to employment contracts that are subject to a non-European proper law of the contract, that is to say as an imperative worker protection provision. However, the scope is in fact limited to such employment relationships that are considered employment relationships under the relevant national law. This is appropriate as, given that the directive is applied concurrently with the national mandatory provisions on worker protection, the demarcation difficulties are kept to a minimum.
The European definition of worker is derived from Art 45 TFEU/39 EC provided that a directive does not refer to national law. According to the ECJ, a worker is defined as a person performing services for a certain period of time for and under the direction of another person in return for which he receives remuneration. This definition is similar to the one in German law: for instance, self-employed persons do not fall under the definition which is also true for the definition under German law. However, the European definition includes civil servants, judges and soldiers whereas this is not the case in German law. This has the effect that the German Nachweisgesetz must be interpreted in conformity with European Law, and consequently the term ‘employee’ in its § 1 must be read to include civil servants, judges and soldiers. Excluded from the scope of application are employees that are employed only temporarily for no more than one month (§ 1 Nachweisgesetz).
Some legal systems did not make use of the exceptions (Luxembourg, Belgium). Others, however, created exceptions which are by far more extensive: in Italy there is no obligation to provide information between married couples and relatives; in Austria there are special rules for domestic workers (§ 1(3) Arbeitsvertragsrechts-Anpassungsgesetz). The most extensive exception is probably in Swedish law: domestic workers, family members, employees in managerial or comparable positions, sheltered employment and temporary work for a public institution are excluded from the scope.
4. The rules in Directive 91/533 and the legal consequences
Article 2(1) obligates the employer to inform the employee of the essential aspects of the employment relationship. The essential aspects of the employment relationship as set out in Art 2(2) are the identities of the parties (Art 2 (2)(a)); the place of work or, where there is no fixed or main place of work, the principle that the employee is employed at various places and the registered place of business or, where appropriate, the domicile of the employer (Art 2(2)(b)); the title, grade, nature or category of the work for which the employee is employed (Art 2(2)(c))—however, it is not necessary for the employee to be able to ascertain from his grade of work whether he would be entitled to a higher salary category if he meets certain requirements; the date of commencement of the contract or employment relationship (Art 2(2)(d)); in the case of a temporary contract or employment relationship, the expected duration thereof (Art 2(2)(e)); the amount of paid leave to which the employee is entitled or, where this cannot be indicated when the information is given, the procedures for allocating and determining such leave (Art 2 (2)(f)); the length of the periods of notice to be observed by the employer and the employee should their contract or employment relationship be terminated or, where this cannot be indicated when the information is given, the method for determining such periods of notice (Art 2 (2)(g)); the initial basic amount, the other component elements and the frequency of payment of the remuneration to which the employee is entitled (Art 2(2)(h)); the length of the employee’s normal working day or week (Art 2(2) (i))—a possible obligation to work overtime, which by its wording does not constitute working time but is performed outside of normal working hours, is not included; where appropriate, the collective agreements governing the employee’s conditions of work; or, in the case of collective agreements concluded outside the business by special joint bodies or institutions, the name of the competent body or joint institution within which the agreements were concluded (Art 2 (2)(j)).
Whether this catalogue is an exhaustive list is in dispute. The ECJ, at any rate, regards it as an illustrative, not an exhaustive enumeration. The Court relies on the words ‘at least’ with which the enumeration is introduced. In the Lange case (ECJ Case C-350/99 – Lange  ECR I-1061) it regarded the employee’s obligation to work overtime whenever requested by the employer as another essential element of the contract. In light of the unambiguous wording, the ECJ’s interpretation is convincing. The legislators of the directive could not have formulated the exemplary nature of the catalogue any clearer.
In what form the information shall be given is set out in Art 3 of the Employee Information Directive. From Art 3(1) of the directive one can infer that it suffices when the employee is provided with a document from which he can see all relevant aspects mentioned in Art 2(a), (b), (c), (d), (h) and (i). This can be a written employment contract as long as it contains all necessary information. If this is not the case, it must be supplemented by a second document (see Art 3(2)2). This obligation must be fulfilled no later than two months after the commencement of employment (Art 3(1)). Should he not satisfy the obligation in time, stricter conditions apply: if the employee is not given the document within the expiry period of two months, then the employer is obligated to give him a written declaration containing at least the information provided for in Art 2(2). This is stricter than para 1 where the obligation to inform is limited to Art 2(2)(a), (b), (c), (d), (h) and (i).
Modifications of aspects of the employment relationship must be made available to the employee in the same fashion no later than one month after the date of entry into effect of the change in question (Art 5(1)). This does not apply to changes of administrative or statutory provisions or collective agreements referred to Art 5(2). For expatriate employees who are employed abroad longer than a month, Art 4(1) in conjunction with (3) of the Employee Information Directive adds these aspects as essential: the duration of the employment abroad (Art 4(1)(a)); the currency to be used for the payment of remuneration (Art 4(1)(b)); where appropriate, the benefits in cash or kind attendant on the employment abroad; and the conditions governing the employee’s repatriation (Art 4(1)(c), (d)).
Pursuant to the first indent of Art 6, Dir 91/533 shall be without prejudice to national provisions concerning the form of the employment contract. As a result this attestation of employment merely has declaratory meaning; a contract is valid even without such proof of essential contract elements.
Pursuant to Art 8(1), the Member States must make sure that employees can pursue their claims by judicial process. The Member States must therefore create an enforceable claim for issuance of information. Furthermore, an employee can refuse performance until he is provided with the respective proof. In some Member States criminal measures and administrative fines and monitoring by public authorities serve as additional incentives for the employer to fulfil his obligations. For instance, in French law Art R-154-3 Code du travail in conjunction with Art 131-13 Code pénal stipulates administrative fines of up to €450 for violations of the obligation to provide information. In Germany there are administrative fines only for individual areas such as the temporary employment business, see § 16(1) no 8 Arbeitnehmerüberlassungsgesetz. Unlike in France, German employees must therefore enforce their rights themselves. Similarly, in the United Kingdom under s 11 Employment Rights Act 1996 the employee must be the one to appeal to the Employment Tribunal.
Paul Davies and Mark Freedland, Labour Law—Text and Materials (1984) 279 ff; Ruth Nielsen, ‘The Contract of Employment in the Member States of the European Communities and in Community Law’ (1990) 33 German Yearbook of International Law 258; Jon Clark and Mark Hall, ‘The Cinderella Directive? Employee Rights to Information about Conditions Applicable to their Contract or Employment Relationship’ (1992) 21(2) Industrial Law Journal 106; Rolf Birk, ‘Das Nachweisgesetz zur Umsetzung der Richtlinie 91/533/EWG in das deutsche Recht’ (1996) NZA 281; Brian Bercusson, European Labour Law (1996) 429 ff; Jeff Kenner, ‘Statement or Contract?—Some Reflections on the EC Employee Information (Contract or Employment Relationship) Directive after Kampelmann’ (1999) 28(3) Industrial Law Journal 205; Roger Blanpain, European Labour Law (10th edn, 2006); Martin Henssler and Axel Braun, Arbeitsrecht in Europa (2nd edn, 2007); Gregor Thüsing, Europäisches Arbeitsrecht (2008); Norman Selwyn, Law of Employment (15th edn, 2008).