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Amendments to the Act on Notification of Conditions governing an Employment Relationship - Important questions and answers

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Germany

On June 23, 2022, the law to amend the act on notification of conditions governing an employment relationship (law to amend the "Nachweisgesetz" – "NachweisG") passed. As a result, existing employer obligations to provide notifications of essential conditions of employment will be extended, and in the event of violations, fines of up to EUR 2,000 per violation will be imposed. In addition, previously applicable notification periods will be significantly shortened in some cases.

The amended NachweisG will already come into force on August 1, 2022 and will apply to both new and existing employment relationships. Therefore, employers should immediately review and adapt their existing sample employment contracts and be prepared for claims of notification requests by existing employees.
 
Which extended notification obligations apply?
The following essential conditions of employment, among others, must be incorporated in the future. This is in addition to the essential conditions of employment already currently specified in the NachweisG:

  • In case of fixed-term employment relationships, the end date of employment.
  • The duration of the probationary period. In case of fixed-term employment relationships, this must be in reasonable relation to the expected duration of the fixed term and the nature of the employee's position.
  • The agreed rest breaks and rest periods and, in the case of agreed shift work, the shift system, shift rhythm and requirements for shift changes.
  • The possibility of ordering overtime and its conditions and remuneration.
  • If agreed, the details of on call work.
  • The composition and amount of remuneration, including remuneration for overtime, surcharges, allowances, bonuses and special payments, as well as other components of remuneration and their due date, as well as the method of payment.
  • If agreed, the possibility of free choice of the place of work.
  • Any entitlement to trainings provided by the employer.
  • The name and address of the pension provider if the employer grants the employee a company pension through a pension provider.
  • The procedure to be followed by the employer and the employee when terminating the employment relationship, at least the written form requirement and the notice periods for terminating the employment relationship, as well as the period for filing an action for protection against dismissal.
  • A reference to applicable collective bargaining agreements, works or service agreements, as well as regulations of commissions with equal representation, which determine conditions of employment for the area of church employers based on church law.
  • In addition, there are extended notification obligations in the case of stays abroad in posting cases.

 Which form requirement applies?
The essential conditions of employment must continue to be handed over to the employee in written form (wet-ink). Employers will not be able to avoid a handwritten signature on paper and a handover of the document. Unlike in other European countries, the German legislator does not allow the information to be provided in electronic form or signed digitally.

Which notification periods apply?
Regarding the notification periods, a distinction must be made between old employment contracts that have already been concluded prior to August 1, 2022 and new hires as of August 1, 2022.

  • In case of old employment contracts, employers must provide the employee with the essential conditions of employment in writing within seven days upon the employee's request.
  • For new hires starting the employment relationship as of or after August 1, 2022, written notification of the essential conditions of employment is required on the first day of employment. Other essential conditions of employment must be handed over within seven days, while a few others must be handed over no later than one month after the start of the employment relationship. However, for reasons of practicability, all notifications should be handed over on the first day of employment. 

Which penalties apply?
For the first time, the new NachweisG provides for specific sanctions in the event of violations of the NachweisG by the employer. If the essential conditions of employment are not provided, not provided correctly, not provided in full, not provided in the prescribed manner or not provided in a timely manner, the employer faces a fine of up to EUR 2,000 per violation.

Furthermore, it cannot be ruled out that in the event of a proven violation of the NachweisG as an applicable obligation under employment law, there is a risk of exclusion from participation in tenders of public authorities. This potential consequence should not be underestimated by employers who regularly participate in public award procedures.
 
What needs to be done now?
Particularly against the background of the partly short notification periods, you should immediately prepare for the amendments to the NachweisG, i.e., review and adapt your existing sample employment contracts, draft sample notifications of the essential conditions of employment, as well as define internal procedures and processes for requests. In this regard, a distinction must again be made between employment relationships that have already been established prior to August 1, 2022 and new employment relationships to be established as of August 1, 2022.

  • For employment relationships that have already been established, you should prepare either a written sample employment contract amendment or a template for a written sample notification of the essential conditions of employment. This should meet the requirements of the amended NachweisG so that you can hand it over to the employee in a timely manner in case of a request.
  • For new employment relationships to be established, you should review your existing sample employment contracts for conformity with the amended NachweisG and make the necessary adaptations. Here, too, it is generally possible to hand over a sample notification of the essential conditions of employment when the employment contract is concluded. The NachweisG does not require all notifications to be made within the employment contract. Depending on the individual case, this would also not be very practical, as in particular detailed references to termination procedures would overload employment contracts.

Contact

For any questions regarding this topic please contact Dr. Marcus Iske and Anne Bremer.

Dr. Marcus Iske
Partner
+49 211 950 749 33
marcus.iske@fieldfisher.com

Anne Bremer
Associate
+49 211 950 749 41
anne.bremer@fieldfisher.com
 

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Employment