While most our articles focus on the digital customer, there is another key stakeholder group – your people – that must be front of mind in your digital transformation strategy. In today’s knowledge-based economy, employees are among the most valuable resources for many companies. Furthermore, your people are on the front line in delivering a positive experience for your customers. Therefore, it is worth taking a look at some of the employment law aspects of digital transformation.
Advances in technology have revolutionized how people view work today. Through technology, we have gained much greater flexibility in terms of where and when we work. We are more connected and can collaborate remotely with colleagues around the world. We can work from home, from the airport, or from our favorite cafe. And online job platforms have given rise to a “gig economy”, where people can work independently and be engaged on a project-by-project basis.
The spread of COVID-19 has also led to the increased use of home office and digital live streaming and webinars instead of office meetings. The crisis shows how future-proof this form of working can be.
While most employees appreciate the increased flexibility, there are also potentially significant risks and legal challenges that need to be addressed. How do we protect employees as the boundaries between work and leisure time become more and more fluid and people are constantly available by email or smartphone? How do we offer flexible working hours, while ensuring real-time responses to customer requests?
The EU’s Working Time Directive (2003/88/EC) sets a minimum standard of employee protection across the EU (although some countries have implemented further measures beyond this minimum). According to the directive, employees must not work more than 48 hours per week on average, they must have minimum rest periods of 11 consecutive hours per day and 24 hours per week, and they must have paid leave of at least four weeks per year.
However, in today’s digital era, the typical eight-hour working day is no longer the norm, and there is no rigid separation between working hours and leisure time as people are constantly reachable by smartphone. In particular, the periods of rest seem to be most vulnerable. For example, is the mandatory rest period interrupted if an employee checks his/her emails at home in the evening or over the weekend? This question often goes unasked and there is little clarity as to what constitutes an interruption during rest periods. According to the European Court of Justice, employees should not be restricted by any kind of obligations within their rest period to ensure that they can freely control their own wellbeing without interruption.
In practice, most employees simply accept the after-work interruptions by email as a trade-off for greater flexibility. Legally, this is largely unregulated due to the fact that the burden of employees being constantly reachable by email is not comparable to being on call. However, in 2017, France introduced a new provision into labor law giving employees a “right to disconnect” by limiting after hours work-related emails. Whether other markets follow suit remains to be seen.
Home Office, BYOD and employee surveillance
With mobile technology, home office is quickly gaining popularity. But what happens if the employee gets injured while working from home? Having private accident insurance in place is indispensable in such cases.
With the home office model, employers need to trust their people more, as supervisors are less able to directly monitor their employees. This can give rise to greater risk of fraudulently recording working time or exceeding statutory working limits.
Generally, the employer is not allowed to collect or use the private data of their employees, other than basic data needed for the purposes of employment. So there are legal implications to consider if you wish to monitor the IT equipment used by your employees. For example, mobile devices used for work continuously collect data. If the employer wishes to have access to this data, it is necessary to obtain a works council agreement or, where there is no works council, an individual agreement. Otherwise, there is the potential risk of non-compliance with data protection rules.
The line separating the private sphere and the working sphere is even further blurred by the approved use of business tools (e.g. mobile, laptop, email account) for personal communication, and “bring your own device” (BYOD) schemes, which allow the business use of private communication tools. This could result in a loss of control of data, raising a potential conflict with data protection laws. To avoid data protection violations, employees have to keep their private data separate from business related data.
Another aspect concerning the use of the home office is the furnishing of the apartment with work equipment. As a result of the COVID-19 crisis, many employees who have the opportunity choose to stay at home and work from there. However, many of these employees are not equipped to work from home over a longer period of time. This shows where there is a need to catch up in order to enable efficient working from the home office as well. Equipping them with the right work equipment also plays a role in occupational safety.
Basically, there are two possibilities for the procurement of work equipment: On the one hand, the employee can be obliged to procure the work equipment himself (“BYOD”). On the other hand, the employer can be obliged – as usual – to provide the necessary work equipment (“Leave your own device”). Which variant is to be given preference depends on the individual case and must therefore always be determined individually. If the employee uses his own work equipment, this is advantageous for the employer at first glance, as no costs are incurred in this respect. However, the employer should be aware that he loses influence if the employee uses his/her private work equipment for professional purposes. In particular, a claim for the return of work equipment, especially storage media such as laptops, mobile phones, external data carriers, is excluded. Nor can the employer forbid the employee working in the home office to hand over the work equipment to third parties, which is particularly problematic in terms of data protection law. If the employee uses his own work equipment, appropriate precautions must be taken in any case to prevent professional data from being misused or even taken note of by third parties. The German Federal Minister of Labour and Social Affairs Hubertus Heil intends to present a draft law on the right to home office by the autumn.
The gig economy
Digital technology has given rise to a new and growing segment of the labor market – often refered to as the gig economy. This essentially refers to the engagement of freelance labor to work on short-term jobs, and is common in sectors such as media, advertising, construction, IT and delivery/transport services. The gig economy has emerged mainly as a result of new technology platforms – such as Uber, Deliveroo and others – which match freelancers with potential short-term job opportunities.
Such working arrangements are growing in popularity – both with businesses seeking short-term help and with workers, who prefer a more flexible and independent working schedule. However, they are also causing controversy, since employers pay no social premiums and wage taxes and workers receive no minimum wage, sick leave or protection from dismissal.
Since independent contractors often do similar jobs as regular employees under similar conditions and policies, many courts in Europe tend to interpret such arrangements as employment relationships. Therefore, companies employing freelancers are at risk of reassessment by the social security authorities, or of claims from the worker before the labor court to requalify their relationship as permanent employment.
As a result of this emerging trend, a number of countries, including France, the Netherlands and others, are enacting legislation to offer greater protection for self-employed or short-term workers and to force employers to pay social security and/or insurance contributions on behalf of such workers.
Wearables at work
Wearables – mobile computer systems that are worn by the user, such as smart glasses or fitness bracelets – are an emerging trend in the digital world. When using such wearables in the workplace, personal information is generally collected, processed and used. Such wearables are typically connected to an individual user account so that information which is generated by the mobile computer system can be assigned to a specific employee. Generally, in such cases data protection provisions are applicable.
Problems may arise when using private wearables at the workplace. The employer is allowed to prohibit not only the use, but also the wearing of smart glasses in the workplace if employees handle sensitive business and company secrets. The risk that an employee could use the camera or recording function of his/ her smart glasses to capture company and business secrets is sufficient to prohibit their use at the workplace.
However, the employer is not allowed to prohibit the use or wearing private wearables at work if the use of these wearables has no impact on the work performance of the employee and is comparable with using a private watch. On the other hand, the employer may prohibit such wearables during working hours if they impact on working time or performance.
Professional use of messenger services
Currently, more than one billion digital consumers around the world use messenger services such as WhatsApp or Skype daily. Messenger services allow employers to quickly and easily reach their employees both during and outside working hours. They are also advantageous in terms of maintaining business contact with customers and business partners.
This trend has already been recognized by service providers. For example, according to media reports a business version of WhatsApp is soon to be developed. However the use of messenger services is only allowed if data protection, as well as protection against unauthorized access, is granted.
Contact lists in employees’ mobile phones regularly include personal data about other employees, customers and other business contacts. From a data protection perspective, the employer is responsible for the protection of this information. The employer must ensure that the data on the business phones of his employees are processed in accordance with the applicable data protection laws. This is can be problematic with respect to the GDPR (which is dealt with in further detail here) as well as local data privacy legislation. In the worst case scenario, lawyers or other individuals with access to confidential information can be punished in case of ill-informed use of messenger services.
Private use of the messenger services on business mobiles can be permitted legally, provided that the employer ensures, through technical tools and instructions provided to the employee, that the instant messenger tools do not have access to business-related data.
Social media as cause for termination
Generally, employees cannot be dismissed based on their activities outside the workplace. However, if employees post abusive, illegal or inappropriate political statements on social media, these are no longer covered by freedom of expression and can lead to a legal basis for a dismissal. In such situations, there needs to be a concrete connection to the employment relationship on social media, for example, if the employee indicates the name of his/her employer on their Facebook profile.
Data privacy in the cloud
Within just a few years, the use of the cloud has become a daily routine for many businesses. As part of their legal right to issue policies and directives, employers can generally select working equipment to be used and give instructions as to its use. The use of cloud solutions generally requires the co-determination of the works council in addition to the usual notification and consultation rights of the works council.
When it comes to technological progress, it is not a question of “if” but rather of “how” it will shape the working world of the digital age. Looking forward, the challenge will be to make effective use of the immense opportunities and advantages offered by new technologies, while at the same time preserving a high standard of employee protection for the future.