If your company concludes employment contracts with new employees, you probably use templates in which the details are filled out individually for each new colleague. You may now have to revise these blank contracts: Because on August 1, 2022, the National Implementation Act comes into force, which contains significant changes to the Evidence Act. If you violate this, you as an employer may face fines of up to 2,000 euros!
Would you like us to review your contracts for you or do you have any other questions about employment law? Then we would be happy to help you.
Employment contracts only in writing
Even those who are only very peripherally involved with legal issues know that the vast majority of contracts are also valid orally. In our everyday lives, we experience such “oral contracts”, for example, when buying bread rolls at the bakery, selling used items at a flea market or talking to a waiter when ordering in a restaurant. Until now, employment contracts could also only be concluded orally. Although written employment contracts have been required by the Evidence Act (NachWG) since 1995, the Act did not provide for any penalties for violations. This is now changing with the new working conditions directive.
In short, this guideline states that in future, all details of an employment contract (including remuneration, rest breaks, overtime and termination) must be set out in writing in the contract. This is certainly already the case with the majority of existing employment contracts. Due to the documentation requirements that now apply, you should nevertheless carefully review your employment contract samples.
New EU Directive: What does that mean?
In principle, EU requirements differentiate between directives and regulations. Regulations are directly effective in all member states — well-known examples include the General Data Protection Regulation (GDPR) or the so-called “Cucumber Regulation”, which was long regarded as a cliché of excessive bureaucracy. In contrast, EU directives must first be converted into national law by EU member states.
Your checklist for new employment contracts
What do you have to consider as an employer from August? We have compiled the five most important points for you:
- Pay: From now on, the employment contract must state whether and how overtime is paid and how it is paid out. In addition, other components of the remuneration — such as Christmas or vacation pay — must be listed individually and given an exact date when they are due.
- Rest breaks: What are the break regulations in your company? From when until when do your employees have rest periods?
- Overtime: Can overtime be arranged? If so, you must also explain the requirements for this.
- Probationary period: Until when is the new employee in the probationary period?
- Cancellation modalities: This point may mean the biggest changes for your model contracts. Until now, employment contracts have usually only included the agreed notice periods (e.g. “the statutory notice periods apply” or “the notice period is four weeks to the end of a calendar month”). From now on, however, you must also state in writing how the termination is to be made and what deadlines apply for filing an action for protection against dismissal.
There is an obligation to provide evidence — but who checks the contracts?
Employers are now asking themselves the legitimate question of who actually reviews newly concluded employment contracts and, if necessary, can impose sanctions for failures to comply with the Working Conditions Directive. It can currently be assumed that (angry) employees and their lawyers in particular will rely on the Working Conditions Directive — particularly in separation situations, in order to put (supposedly) pressure on you as an employer.
Violations of the Evidence Act represent administrative offenses from August. Such violations exist, for example, when you...
- ... do not hand over the essential contract terms in writing
- ... the essential terms of the contract are incorrect
- ... the essential terms of the contract are incomplete, or
- ... hand over the essential contract terms too late.
And the old employment contracts?
The obligation to provide evidence initially only applies to employment contracts entered into after August 1, 2022. If an employee who worked in your company before this date also demands to receive his contract details in accordance with the new directive, you must hand them over to him within a period of seven days.
What else is important?
The EU directive would have allowed the digitization of recruitment processes and the electronic transmission of contracts and signatures. Unfortunately, this point was not included in the German implementation of the law. Employment contracts must be printed out and signed by the new employee. Digital signatures are not valid.
