EC: Commission consults on working time Directive

On 5 January 2004, the European Commission issued a Communication on the re-examination of the 1993 working time Directive. It invites comments from interested parties on the Directive's reference periods for calculating average working time, the possibility of allowing individuals to opt out of the maximum 48-hour week, recent ECJ case law regarding on-call working, and measures to improve work-life balance. It looks in detail at the operation of the opt-out, finding that there is evidence that it creates difficulties in ensuring respect of the spirit and terms of the Directive.

Background

The 1993 working time Directive (93/104/EC) aims to ensure a better level of health and safety protection for workers by limiting excessive working hours, providing for sufficient rest breaks and the regular organisation of work. Its main provisions include:

• a minimum rest period of 11 consecutive hours for each 24-hour period;
• a rest break where the working day is longer than six hours;
• a minimum rest period of one day per week;
• maximum weekly working hours of 48 hours on average, including overtime;
• four weeks of paid annual leave; and
• an average of no more then eight hours of work at night in any 24-hour period.

All member states were obliged to transpose the provisions of this Directive into national legislation by 23 November 1996 and all have now done so.

The original Directive contained a number of exclusions - workers in air, rail, road, sea, inland waterway and lake transport, sea fishing, other work at sea and doctors in training. However, the 1993 Directive was amended by Directive 2000/34/EC, passed in May 2000, bringing non-mobile workers in these sectors within the scope of the Directive. In addition, a number of EU sectors negotiated their own agreements on working time, under Article 14 of the Directive, which were subsequently given legal force by means of a Directive. These were principally the 1998 accord in the maritime sector and the 2000 accord in the civil aviation sector. A further Directive covering mobile workers in the road transport industry (2002/15/EC) was adopted in 2002 (EC: New working time and consultation Directives in force ).

The review

The 1993 Directive allows for the average maximum working week of 48 hours to be calculated over a longer period ("reference period") of up to four months. In addition, it is possible to derogate from this and extend the reference period to six months or, by collective agreement, to 12 months.

Further, it allows member states to include in their transposing legislation a clause allowing individual workers to opt out of the maximum 48-hour working week, known as the "opt-out".

The text of the Directive states that two of its provisions could be reviewed before 23 November 2003. These were:

• the derogations from the reference period for the application of Article 6 of the Directive (the maximum working week); and
• the option of not applying Article 6, if the individual worker consents to this (the opt-out).

In addition, the Commission notes that there have been important European Court of Justice (ECJ) rulings regarding the definition of working time with regard to on-call working, notably the Simap case of 3 October 2000 and the Jaeger case of 9 October 2003. These cases essentially stated that on-call working should be considered to be working time, even where the employee is provided with a bed to sleep in on the employer's premises during periods of non-working. It is therefore timely to look at the Directive in the light of these cases (see below for more detail).

The Commission, therefore, states that this review has three aims:

• to evaluate the application of the two above-mentioned provisions for which review is provided in the text of the Directive - on derogations from the reference periods for calculating average weekly working time and the opt-out;
• to analyse the impact of the recent ECJ judgements in the area of the definition of working time and the status of on-call working, in addition to new developments aimed at improving work-life balance; and
• to consult the European Parliament, the Council, the European Economic and Social Committee, the Committee of the Regions and the social partners on a possible revision of the text.

Implementation of the reference periods

The Commission notes that only four member states (Greece, Ireland, Portugal and the UK) faithfully reproduce the provisions of the Directive in relation to reference periods - they provide for a reference period of four months for calculating the maximum average weekly working time and the possibility of setting out a longer reference period by collective agreement, up to a limit of 12 months.

In Denmark, no reference periods are set out by law - collective agreements provide for reference periods of between four and 12 months. In Finland, the four-month reference period is applied only to the maximum amount of overtime - collective agreements may set out a 12-month reference period for ordinary working time and for limiting overtime. In France, the 48-hour limit is absolute and not an average to be calculated over a reference period. Other member states have different reference periods, often of one year, for the calculation of ordinary working time, which is less than the 48-hour maximum set out in the Directive.

In general, the Commission states that: "There appears to be a tendency towards expressing working time as an annual figure."

With regard to extending the reference period to up to 12 months by collective agreement, the Commission notes that member states are not all in the same position, due to the fact that coverage by collective bargaining varies widely, from 36% in the UK (22% when only the private sector is taken into consideration), to almost 100% in some member states. It also notes that the possibility of using agreements other than collective agreements has not been employed - in the UK, use of "workforce agreements" is rare.

Use of the opt-out

Article 18(1)(b)(i) of the working time Directive allows member states to make provision for a worker to work longer than 48 hours a week under the following conditions:

• the employer must gain the prior consent of the worker to do this;
• no worker should be subjected to any detriment by their employer because they are not willing to give their consent to do this;
• the employer must keep up-to-date records of all workers working longer than 48 hours a week;
• the records are placed at the disposal of the competent authorities, which may, for health and safety reasons, prohibit or restrict the possibility of exceeding the 48-hour limit; and
• the employer must provide the competent authorities at their request with information on cases in which agreement has been given by workers to exceed the 48-hour week over a period of seven days, calculated as an average over a reference period of four months.

A key feature of the worker's consent is that it must be free and informed. The Commission states that: "The worker may not be pressured into signing the agreement and may not suffer harm if he decides not to sign."

Implementation in the UK

Looking at the situation in individual member states, the Commission notes that the UK is the only country that has made general use of this possibility of allowing workers to opt out of the 48-hour weekly maximum. However, although the revised version of the UK's implementing legislation - the Working Time Regulations, 1999 - makes reference to employer record-keeping, it does not, in the Commission's opinion, fully comply with the Directive's requirements in the area of record-keeping concerning workers working above 48 hours a week. It also states that if there is no record of time actually worked by these workers, it is difficult to ensure that there is compliance relating to other areas of the Directive, such as daily rest periods, breaks and weekly rest periods.

The Commission also notes that there has not been a significant difference in the system governing working time in the UK, mainly as a result of the implementation of this opt-out. Around 4 million people, or 16% of the workforce in the UK, currently work more than 48 hours a week, compared with 3.3 million, or 15%, at the beginning of the 1990s - the UK is also the only EU member state to have seen an increase in weekly working time over the past decade. However, the number of people stating that they habitually work more than 48 hours a week has been consistently falling since 1999.

There are no reliable figures on the number of workers in the UK who have signed an individual opt-out, or those who have refused to sign an opt-out, although the Commission states that "all players agree that it is considerably higher than the number of workers who strictly need it."

It cites two surveys of the opt-out in the UK. The first, carried out by the Employment Lawyers Association in collaboration with Personnel Today, found that 65% of 759 undertakings replying to a questionnaire had asked their employees to sign an opt-out. An opt-out had been signed by over half of workers in 61% of these undertakings - in 28% of them, all the workers had signed an opt-out.

The second, ordered by the employers' association CBI, found that 33% of workers have signed an opt-out agreement, which is more than double the percentage of those who say that they actually work more than 48 hours.

It, therefore, looks as though the number of people signing opt-out agreements is considerably higher than the number of those who actually work more than 48 hours a week on average.

The reasons why people sign an opt-out could include the following:

• people habitually work longer than 48 hours and want to continue to be able to do so. However, given that almost half of the 16% of people saying they habitually work more than 48 hours a week have management tasks, they could be covered by Article 17(1) of the Directive, which permits a derogation from the 48-hour limit (see below). Therefore "only a proportion of these workers actually has need of the opt-out";
• the reference period for calculating the 48 hours does not make it possible to respond to undertakings' needs for flexibility and it can only be extended to one year by collective agreement. Given the fact that coverage by collective bargaining is comparatively low in the UK, the CBI stresses the importance of the opt-out: "the individual opt-out is particularly important to the UK given the importance attached to individual agreed contracts";
• the potentially applicable derogations are unclear. The Commission states that the derogation provided for by Article 17(1) of the Directive, allowing workers whose working time is not measured and/or predetermined or may be determined by the workers themselves not to be bound by the 48-hour maximum, is one of the reasons why people potentially covered by this have chosen the opt-out instead; and
• the administrative constraints are minimal. The 1999 amendments to the UK's implementing legislation have "significantly" reduced the constraints with regard to record-keeping in the case of workers who have signed the opt-out: "This simplification no doubt largely explains the use of the opt-out even where the worker does not generally exceed the 48-hour limit."

Implementation in other member states

The Commission believes that the ECJ's ruling in Simap (see below), which essentially stated that on-call working on an employer's premises should be calculated as normal working time, has had a significant impact on other member states' decisions on whether to apply the opt-out. Essentially, they saw this as "a way of alleviating some of the problems created by this case law, allowing doctors to continue to work for more than 48 hours per week (including on-call time) if they wished".

All member states incorporating this clause into their legislation, with the exception of Luxembourg, did so for the health sector alone. Luxembourg has introduced the opt-out for the hotels and catering sector by means of legislation dating from 20 December 2002.

In France, legislation which came into force on 1 January 2003 allows a range of health care professionals, including practitioners in hospitals and doctors and pharmacists recruited by public health care establishments, to carry out, on a voluntary basis and beyond their weekly duties, additional work, which is either compensated or gives rise to time off in lieu.

Other member states, notably Germany, the Netherlands and Spain, are in the process of drawing up new legislation introducing the opt-out in the health sector or in cases where working time regularly includes time spent on call.

Two acceding member states - Malta and Cyprus - have already incorporated the opt-out into their legislation, whereas Slovenia applies the opt-out to doctors only. The Commission believes that Estonia, Hungary, Latvia and Lithuania could make use of the opt-out to resolve the problems created by the ECJ's rulings on working time and on-call working.

ECJ case law on working time

Over the past few years, there have been two important ECJ rulings on the definition of working time, revolving around the issue of on-call working. Article 2 of the 1993 Directive defines working time as "any period during which the worker is working, at the employer's disposal and carrying out his activity or duties, in accordance with national laws and/or practice." It defines a rest period as "any period which is not working time", therefore meaning that there is no interim category - a period of time is either working time or a rest period.

The Simap case

This case (C-303/98) was referred to the ECJ by a Spanish court, which asked about the definition of working time. It asked for clarification as to whether on-call working performed by doctors in primary health-care teams, on the basis of either being physically present at the health establishment or being contactable, constituted working time or overtime within the meaning of the Directive. The ECJ ruled on 3 October 2000 that this time must be regarded in its entirety as working time and, where appropriate as overtime, if they are required to be at the health centre. If they must merely be contactable when on call, only time linked to the actual provision of health care services must be regarded as working time.

The Jaeger case

This case (C-151/02) was referred by a German court, also asking the ECJ its view on the definition of time spent on call by doctors when they are required to be physically present at the hospital. Specifically, it asked whether on-call services should be considered in their entirety as working time, even if the party does not perform their professional duties but is authorised to sleep during the time concerned. The ECJ ruled on 9 October 2003 (ECJ: On-call working is working time ) that a period of duty spent by a doctor on call must be regarded as working time, even if the person is permitted to rest at the place of work during the periods when their services are not required. These periods of inactivity within the context of on-call working should not be classed as rest periods.

Impact of ECJ case law

The Commission notes that, prior to the Simap ruling, working time was generally interpreted to mean that periods of inactivity during time spent on call should not be defined as working time. In most member states therefore, periods spent not working during on-call duty were excluded from working time. Consequently, the Simap ruling has had a major impact, particularly in the health sector, as on-call working is most widespread among doctors. The Commission also notes that the impact of the ECJ's rulings will be even greater when Directive 2000/34/EC is applied with respect to trainee doctors on 1 August 2004, implementing the 48-hour week in stages (although there is a transition period of four years that can be extended to eight years).

Most on-call working requiring a physical presence at work is performed by trainee doctors. The Commission cites a survey carried out on its behalf that states that hours worked by doctors in training routinely exceed 55 hours a week in many countries.

To comply with the maximum working week of 48 hours, including all time spent on call, most member states will need to recruit additional doctors to ensure the same level of care. The German government has said that, following the Simap and Jaeger cases, staffing requirements in German hospitals would increase by around 24% and between 15,000 and 27,000 additional doctors would need to be employed, costing an additional €1.75 billion.

The UK government has said that it would need to recruit between 6,250 and 12,550 doctors and a further 1,250 staff other than doctors, costing between £380 million and £780 million (between €551 million and €1,133 million). The Dutch government estimates that it would need to recruit 10,000 new care staff, resulting in additional costs of €400 million.

However, all member states agree that even if it were possible to pay for these extra staff, it would be impossible in practice due to the lack of candidates with the necessary training to take on these jobs. It is therefore feared by the Commission that some member states will use the derogations or exceptions on offer in the Directive, primarily the opt-out: "This is already the case in some member states or will be the case in the near future. There is also the risk that, in view of the problems they face, some member states might be tempted to resort to arrangements which offer much less protection, such as using self-employed doctors, who are not covered by the provisions of the Directive."

Improving the compatibility of work and family life

The Commission states its belief that the revision of the Directive could be used to encourage member states to take steps to improve the compatibility of work and family life. Greater flexibility in the organisation of working time would, it argues, meet the growing needs of workers, particularly those with dependants, as well as the interests of companies, which need to be able to respond to user and customer demands for extended operating hours to adapt rapidly to fluctuations in demand.

It notes that all member states have implemented or planned some measures to make working time more flexible and to make work and family life more compatible. These include elements such as: allowing workers to reduce or adapt working hours in order to care for young or seriously ill children or terminally ill family members; facilitating and encouraging part-time working; increasing possibilities for individuals to adapt their working hours to suit their partner's working situation; introducing time credit systems; and phasing out working hours for older workers.

The way forward

The Commission believes there are several ways forward, but lists what it feels are the criteria that must be met by the solution chosen:

• workers should be given a high level of health and safety protection in respect of working time;
• firms and member states should have more flexibility in the way they manage working time;
• it should be made easier to reconcile work and family life; and
• no unreasonable constraints should be imposed on firms, particularly small and medium-sized businesses.

The Commission highlights the following five areas that it would like those responding to this Communication to address:

• the reference periods contained in the Directive;
• the ECJ's interpretation of the concept of working time in the Simap and Jaeger cases;
• the conditions of application of the Directive's opt-out;
• measures aimed at improving the reconciliation between work and family life; and
• whether an interrelated approach to these issues would allow for a balanced solution capable of meeting the four criteria set out above.

The Commission is inviting comments from the European Parliament, the Council, the Economic and Social Committee, the Committee of the Regions and the social partners at EU level. All interested parties at national level are also invited to send in their comments and suggestions to: empl-labour-law@cec.eu.int . All comments should be sent to the Commission by 31 March 2004.

This process constitutes the first phase of the European social partner consultation process, provided for by Article 138(2) of the Treaty. A second consultation phase, on the content of any proposal envisaged, will follow once the Commission has digested all the replies.

While it is not possible to anticipate what the Commission will do, it is clear that much emphasis will be placed on the opt-out provided for by the Directive. It was acknowledged at the time the Directive was formulated that this clause could put at risk the Directive's aim of protecting workers' health and safety, which is why there is provision for its review after a period of seven years. The Commission clearly believes that the opt-out is problematic: pointing to the experience of the UK, it says there are: "existing difficulties in ensuring that the spirit and terms of the Directive are respected and that real guarantees are provided for workers. It also brings out an unexpected effect in that it is difficult to ensure (or at least check) that the other provisions in the Directive have been complied with, concerning whether workers have signed the opt-out agreement." It is clear that more member states will now be looking at applying this opt-out, following the ECJ judgements on on-call working. Hence, there is certainly a possibility that the Commission will suggest dropping or at least revising the terms of the opt-out.

The full text of the Commission's Communication focusing on the re-examination of Directive 93/104/EC concerning certain aspects of the organisation of working can be found at: http://europa.eu.int/comm/employment_social/consultation_en.html.

Initial responses Interested parties will no doubt be spending the coming weeks formulating their submissions to the Commission. The European Trade Union Confederation (ETUC) has swiftly issued an initial response, expressing its concern that the Commission has not issued any concrete proposals for overhauling the Directive at this stage, despite the fact that Commission research has found that the implementation of the Directive has not been satisfactory. John Monks, ETUC general secretary, issued the following statement: "With Commissioner Diamantopoulou having accepted that the implementation of the working time Directive has been unsatisfactory, particularly though not exclusively in the United Kingdom, and that as a result the health and safety of European workers is being compromised, I am very disappointed that the Commission has not felt able to come forward now with concrete proposals for remedying the situation." Referring to the fact that the present Commission's mandate expires on 31 October 2004, he continued: "We know that there are those who will want to play for time, and to try to extend the period of consultation until the Commission's mandate is effectively over. Knowing the Commissioner, I am confident that she will not want delay and fudge to be her last testament, and that we shall see from her this April strong and sensible proposals for ensuring that the original aims of the Directive ten years ago - that working women and men should not damage their health through very long hours of toil - are fulfilled." UNICE has not yet issued a public statement on this issue. However, the UK employers' organisation CBI has issued a press statement. The UK will be the most affected country if the Commission decides to modify or abolish the opt-out. Susan Anderson, the CBI's director of human resources policy said: "The Commission is right to recognise the importance of choice over working hours and the value of the individual opt-out from the working time rules. This review must not lead to the removal of that vital freedom. UK employees have more choice about the hours they work than those almost anywhere else in Europe. They value that flexibility and so do employers. We accept there must be safeguards to prevent abuse but the current legislation offers that. The Commission and the TUC have both failed to find evidence of widespread abuse. We do not believe that employers are routinely pressurising workers into signing opt-outs. People have the right to say 'no' to long hours and the directive rightly gives them that protection, but they must also have the right to say 'yes'."