EU Time Tracking Law

EU Labor Law (2003)

EU's Working Time Directive that regulates employee labor and working time. If you employ staff, you need to know the basic rules about working hours and guarantee the minimum standards set by the EU directives:

• Working time and rest: employees can't work more than 48 hours per week on average (including overtime, excluding breaks), must have at least 11 consecutive hours of daily rest and at least 24 hours of uninterrupted weekly rest.
• Breaks: After working for 6 hours, employees must take a 15-minute break (breaks are not counted as work hours). Employees who work 9 hours must have a 45-minute break.
• Annual leave: Employees have the right to at least 4 weeks of paid holidays per year
• Overtime: Employees can opt out of the 48-hour week limit
• Night work: Maxiumum 8 normal work hours for night workers in every 24-hour period

Since excessive working time is cited as a major cause of stress, depression, and illness, the purpose of the directive is to protect people's health and safety.

What's interesting is that EU countries have the lowest number of working hours per year in the world, yet that doesn't impact their productivity, proving that more work hours leads to lower productivity.

So far, the directive is at the EU level, meaning businesses are not required to track time, yet. However, each members country has to make its own national law that implements the EU directive, as well as iron out the specifics.

German labor law

Germany's labour law implements everything from the EU directive, plus more:

• Standard work hours: max 8 work hours per day or 48 work hours per week
• Any work after the 8-hour mark is considered overtime
• Overtime must be documented (via a hard-copy or software), wet signed by the employee, and kept for at least 2 years
• Employees are not allowed to work for more than 10 hours per shift (8h of max standard time + 2h of overtime)
• Workday has to have a pre-scheduled unpaid 30-min break which can't be skipped (break is not counted as work time)

Example: if you come in at 8:00 and your contract stipulates 8 hours per day, the earliest you can leave is at 16:30 (8h of work plus the mandatory 30-min break), and the latest you can leave is 18:45 (max 10 work hours per day plus the mandatory 45-min break). In practice, most people end up working 40 hours per week by making the contract require 37.5 work hours a week (or 7.5 hours a day).

The new EU timekeeping requirement (2019)

In May 2019, the European Union's highest court ruled that all employers must track their employees' working hours.

How it happened? This decision comes as a result of a lawsuit against Deutsche Bank by CCOO, a Spanish trade union. According to the trade union, Spain's lax timekeeping laws did not require detailed recordkeeping of the hours worked by employees, which led to Deutsche Bank underreporting the hours and underpaying for overtime (estimated 54% of unpaid overtime hours), which violated EU labor law set out by the EU Working Time Directive.

In the end, the EU ruled that everyone must keep track of all work time (and not just overtime like before): member states and employers have a duty to create an objective, reliable and accessible system for measuring daily working time. This concerns the entire ­span of daily working time, and not only overtime.

Now that the EU has ruled in favor of employee time tracking, the next step is for member states to evaluate their options and build on the law as they see fit.

The EU labor law doesn't require employees to track work hours, only overtime. But now, employers need to keep track of all time.

Spain's time and attendance law

So far, timekeeping in the European Union was not obligatory (unlike in the US). Timekeeping been used voluntarily by companies that needed to know how many hours they've worked for client invoicing and payroll purposes.

Spain is the first country that introduced the law based on the EU directive:

• All companies must keep an hourly record of their employees regardless of the work day they have
• Companies must keep the employee's time record for four years
• Time records must be public and available to employees, unions, and the government
• Employees must know the distribution and duration of an ordinary workday
• The unions must be notified monthly of employee overtime hours
• A record must be kept of the start and end of every working day for each employee, including breaks (even for remote workers)

Businesses that fail to comply will face fines ranging from €626 to €6,250 (decided by inspectors based on the size and nature of the business, number of employees and turnover). Recording working hours is the responsibility of the employer and not the employee, so it will be the company that will face the fines.

This law was designed to help correct the situation of precariousness, low salaries and poverty that affects many workers who suffer abuse in their working day. The measures are designed to uncovering the excess hours worked by those mainly in the trade, hospitality and construction sector, which is where exploitation is most concentrated. According to data, an estimated 2.6 million overtime hours per week goes unpaid overtime.

Spain's law does not define how employers should track work hours and attendance. In most cases, a simple clock-in/clock-out system for monitoring start/end work/break suffices. If you're in doubt, it's best to consult with a lawyer.

What EU timekeeping law means for employers?

As stated in the press release, EU employers must set up "an objective, reliable and accessible system" for tracking employee time during the workday. What's not clearly stated is what that time tracking system should look like. EU left it up to member states to iron out the details.

Until more specific time tracking directives are made, employers should focus on implementing a system that will protect workers first.

As for what is mandated, the ruling currently says employers must have a time tracking system not just to keep track of overtime hours, but also to ensure that employees get their obligatory rest periods—at least 11 uninterrupted hours a day and 24 uninterrupted hours per week, as well as rest breaks after every six hours of work.

To comply with the EU time tracking law, invest in a system that allows you to track time accurately and objectively. Time clock, app, paper list - everything is possible.

Time tracking benefits

Employee benefits:

• No more overtime without remuneration and wage thefts
• Legal protection from abusive employers
• Saner work hours and healthier work-life balance
• Right to digital disconnection needed to truly enjoy the benefits of time-off (not having to respond to emails outside of working hours)
• No more consecutive work shifts (minimum 12-hour break between working hours)

Employer benefits:

• Organized and digitized records makes payroll and salaries more accurate
• Increased transparency and trust between employers and employees
• Increased employee health and productivity (as more working hours actually hurts productivity)
• Better handle on true costs, time sinks, and inefficiencies
• More accurate quotes and deadlines based on actual historic data