In this fifth and final episode of our Working from Home series, we will dive into the less explored topic of working time for teleworkers.

When it comes to working time, teleworkers are a bit of a special breed. Teleworkers are excluded from the majority of the provisions of the Labour Act, in particular the chapter on working time. Whether this was oversight or just because the point was too hard is unclear. Where the national Collective Labour Agreement nr. 85 on teleworking states that “the teleworker shall organize his own work, within the framework of the working hours applicable in the company”, this is really just wishful thinking on the part of the social partners, as the Labour Act still hasn’t been adjusted in this respect. As a consequence, the statutory limits on daily and weekly working time do not currently apply to teleworkers.

That current state of the legislation implies that teleworkers who exceed the daily or weekly limits on working time are not automatically entitled to overtime pay and time off in lieu.  At least not on the basis of the Labour Act, as they are not covered in it. But there may be other sources that still entitle the teleworker to extra pay for the hours they perform on top of the agreed weekly working time. In such cases, however, the employee will be entitled only to his/her actual salary for the additional hours performed, not the overtime premium of 50 / 100% (for work on Sundays and bank holidays) on top of the regular hourly salary. The reasoning is similar to that applied to employees in a position of trust or a managerial position (as defined in the Royal Decree of 1965): the Labour Act does not entitle them to pay for the hours they work on top of the regular weekly working time, but they may still make such a claim on the basis of other sources of law.

Those other sources of law that may allow the teleworker to claim extra salary are the following:

The employment contract – If parties have agreed in the employment contract, for example that the monthly salary is based on a contractually agreed number of working hours, it may be deduced from the contract that hours performed in addition to that fixed number should be paid separately.
Provisions in the employee handbook may also award the teleworker the right to receive normal pay for the additional hours.
There may also be a custom borne of long practice in the company to pay for them. In order for a practice to be considered a customary term, it should have been applied consistently for a long period of time, either to the entire staff or to a specific category of employees (e.g. all the teleworkers). Where the practice varies within such a group, however, or is applied only sometimes or is made the subject of a separate decision by the employer each time rather than being used automatically, then a customary term is unlikely to arise.
Finally, fairness may also be the legal basis for compensation of the additional hours. Although fairness is not an official source of law, certain case law does apply it as the basis for extra compensation. This fairly vague notion allows employment tribunals to assess whether it may be considered fair that all of the teleworker’s activities should be deemed to be covered by his/her monthly salary. Fairness may come into play in particular in cases where the agreed salary was considered particularly low relative to the efforts expected from the employee. Where the tribunals consider the employee’s salary, they take into account not just the base salary, but also annual premiums and bonuses as well as other benefits.

The teleworker who claims payment of overtime will be required to adduce evidence of 1) the overtime performed and 2) the source of law that warrants payment of overtime. Employment tribunals are mindful of the difficulty an employee may have to demonstrate the performed overtime and for this reason, will sometimes rely on an ex aequo et bono assessment of the compensation, or put less formally, skip the detailed legal consideration and just award what they think feels right.

The conclusion to all this is that with teleworkers, employers have a lot more flexibility when it comes to working time. Not every additional half hour performed will automatically lead to overtime pay, but it is important that both parties have a clear understanding from the start of any such arrangement of what is expected of the employee as part of their work assignment. This understanding should be clearly reflected in the employment agreement and it may not be contradicted by the employee handbook or a conflicting custom. That does not mean that exceptional work can never be rewarded separately, but when it is, it should be communicated why the extra work is considered to be exceptional (as in: not part of the employee’s regular job description or work load) and thus compensated separately. This to avoid any risk that the compensation arrangements will themselves create a customary term over time.

So far, the number of pay claims brought by teleworkers remains fairly low, but with the surge of home working over the last two years, this number is expected to rise significantly. A solid contractual framework and a coherent policy should go a long way to fend off such claims.

Employment Law Worldview