Magna Charta Magazine Hiring & Firing Baker McKenzie by Academie voor de Rechtspraktijk

THE

MAGNA CHARTA JA NUARI 2017 | RIJKSMUSEUM

M AGA Z I N E

Hiring & Firing

Law and key employment trends in Europe. The Baker McKenzieâ&#x20AC;&#x2122;s European Employment Guide The right to strike by Marloes Diepenbach PHD CANDIDATE (University of Amsterdam) | The mandatory 'transition payment' in Dutch dismissal law by Vivian Bij de Vaate ASSISTANT PROFESSOR LABOUR LAW (VU University) | Q&A with Hendrikje Crebolder HEAD DEVELOPMENT (Rijksmuseum) | Q&A with Claartje van Fulpen VICE PRESIDENT Mitsubishi Caterpillar Forklift Europe

MAGNA CHARTA

WITH THE COOPERATION OF GUENTHER HECKELMANN - BAKER MCKENZIE I FRANKFURT, GERMANY • BERNHARD TRAPPEHL - BAKER MCKENZIE I MUNICH, GERMANY • MASSIMILIANO BIOLCHINI BAKER MCKENZIE I MILAN, ITALY • MIRJAM DE BLÉCOURT - BAKER MCKENZIE AMSTERDAM, THE NETHERLANDS • REMKE SCHEEPSTRA - BAKER MCKENZIE AMSTERDAM, THE NETHERLANDS • FERMÍN GUARDIOLA - BAKER MCKENZIE MADRID, SPAIN • PIOTR RAWSKI - BAKER MCKENZIE I WARSAW, POLAND CHRISTINE O'BRIEN - BAKER MCKENZIE I LONDON, UNITED KINGDOM • CLAARTJE VAN FULPEN - MITSUBISHI CATERPILLAR FORKLIFT EUROPE I ALMERE, THE NETHERLANDS • HENDRIKJE CREBOLDER - RIJKSMUSEUM I AMSTERDAM, THE NETHERLANDS • MARLOES DIEPENBACH - UNIVERSITY OF AMSTERDAM AMSTERDAM, THE NETHERLANDS • VIVIAN BIJ DE VAATE - VU UNIVERSITY AMSTERDAM, THE NETHERLANDS SPECIAL THANKS TO

DANIELLE PINEDO - BAKER MCKENZIE AMSTERDAM JONATHAN TUCK - BAKER MCKENZIE LONDON LAURA GARCIA - BAKER MCKENZIE MADRID SERGIO ANTONELLI - BAKER MCKENZIE MILAN THOMAS MEYERHANS - BAKER MCKENZIE MUNICH ALINA KOCIECKA - BAKER MCKENZIE WARSAW ANNA VAN BRACHT - BAKER MCKENZIE AMSTERDAM CLAUDIA WEHMEIJER-REUS - BAKER MCKENZIE AMSTERDAM BMK | Hiring & Firing | januari 2017 WILLEMIJN DE GAAY FORTMAN - BAKER MCKENZIE AMSTERDAM

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For the last ten years the Rijksmuseum has been able to purchase important and rare masterpieces from twentieth-century photography thanks to the support of Baker McKenzie. Photography is the art of the 20th century. Since the dawn of the modern era it has concerned itself with such themes as speed, travel, world politics and mass media. The American photography is especially present in the collection.

A night at the museum with Baker McKenzie MAGNA CHARTA | BAKER MCKENZIE | RIJKSMUSEUM

The collection includes work by internationally recognized artists like Man Ray, William Klein, Lisette Model, André Kertész and Saul Leiter. A selection of purchases over the last ten years can be seen in the Photo Gallery of the Rijksmuseum from 17 February to 21 May 2017.

BAKER MCKENZIE vs

s THE OLD MASTERS

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CONTENTS 01

Artikel Guenther Heckelmann Chair Baker McKenzie Global Employment & Compensation Group (p14 - p18)

Hiring & Firing

law and key employment trends in Germany (p20 - p45)

Hiring & Firing

law and key employment trends in Italy (p48 - p69)

The right to strike by mr. Marloes Diepenbach

(University of Amsterdam) (p72 - p75)

Hiring & Firing

law and key employment trends in the Netherlands (p76 - p93)

Hiring & Firing

law and key employment trends in Spain (p100 - p119)

The mandatory 'transition payment' in Dutch dÂ ismissal law by mr. dr. Vivian Bij de Vaate

(VU University Amsterdam) (p120 - p123)

Hiring & Firing

law and key employment trends in Poland (p124 - p141)

Interview

with mr. Claartje van Fulpen Mitsubishi Caterpillar Forklift Europe (p142 - p145)

Hiring & Firing

law and key employment trends in United Kingdom (p146 - p165)

Interview

with mr. Hendrikje Crebolder (p96 - p99) Rijksmuseum Amsterdam BMK | Hiring & Firing | januari 2017

From the EDITOR Welcome to this special edition of The Magna Charta Magazine, titled "Law and Key employment trends in Europe". For today's employers, managing a global workforce requires complying with local labor and employment laws in multiple jurisdictions, staying abreast of rapidly changing regulations, handling the growing demands of labor unions and works councils, and moving talent quickly across borders. It also means developing strategies to retain high-potential employees, especially during reorganizations and spinoffs. To achieve these objectives, it's essential for employers to stay up-to-date on the latest employment trends in areas such as workforce restructuring, reward programs, and labor and human rights. In this issue, we explore the law and key employment trends in Germany, Italy, the Netherlands, Spain, Poland and the United Kingdom. With more than 700 labor and employment lawyers in 47 countries, Baker McKenzie uses its domestic experience and global perspective to provide seamless and integrated advice. Among the topics addressed inside are the different aspects of Employment Law, Collective Dismissals and Individual Dismissals. What do the hiring and employment terms look like in various countries? How should various parties be involved? Do you need to involve any collective or official bodies when dismissing an individual employee? Guenther Heckelmann, Chair of Baker McKenzie's Global Employment & Compensation Group talks about Global legal trends in the Employment world. Marloes Diepenbach, PhD Candidate, University of Amsterdam gives us inside information about the harmonious model of collective labor relations in the Netherlands and Claartje van Fulpen, Member of the European Board of Directors, Mitsubishi Caterpillar Forklift Europe B.V. shares her biggest challenge with us. And, what are the key challenges EMEA employers are facing according to Fermin Guardiola, Chairman of the EMEA Employment & Compensation Group? We hope this magazine gives you valuable information and insights into the European employment law combined with key employment trends. We welcome any feedback that you may have.

Mirjam de BlĂŠcourt - Partner and Head of the Employment & Compensation Group - Amsterdam

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HIRING & FIRING LAW AND KEY EMPLOYMENT TRENDS IN EUROPE

COUNTRIES

Germany

Netherlands

Poland

Italy

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Spain

United Kingdom

"Try to put well in practice what you already know; and in so doing, you will in good time, discover the hidden things which you now inquire about. Practice what you know, and it will help to make clear what now you do not know."

Rembrandt van Rijn BMK | Hiring & Firing | januari 2017

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INTERVIEW

Guenther Heckelmann Chair of the Baker McKenzie Global Employment & Compensation Group

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BERLIN

Guenther Heckelmann Chair of the Baker McKenzie Global Employment & Compensation Group

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DUSSELDORF Can you tell us something about Baker McKenzie in general? Well, Baker McKenzie is one of the largest law firms in the world. As a commercial law firm, we help clients overcome the challenges of competing in the global economy by solving complex legal problems across borders and practice areas. We do this for many of the largest businesses in the world across a range of industries. What makes us different is that we apply commercial acumen to the advice we provide, our lawyers look at both the bigger picture and the acute legal issue. Within the global employment practice, our lawyers implement major business change projects, develop business protection strategies, develop industrial relations strategies, advise on HR compliance, and advise on day to day HR management, recruitment and rewards, and global mobility issues.

MUNCHEN For instance, how many offices in how many countries and what are the services that Baker McKenzie offers With around 11,000 staff across 77 offices in 47 countries, our service portfolio covers all of the complex challenges and opportunities that modern global businesses face in the areas of Employment, Tax, Mergers & Acquisitions, Banking & Finance, Intellectual Property, Compliance, Anti-trust & Competition, Capital Markets, Dispute Resolution, Private Equity, Real Estate and Trade & Commerce. As well as having practice groups, we also have industry groups. What is unique about Baker McKenzie is that a culture of friendship is at our core. This is key to ensuring we can deliver projects both seamlessly

FRANKFURT

and fluently that include multiple practice groups across multiple jurisdictions.

What is your role within Baker McKenzie? Primarily, I am the Chair of the Global Employment & Compensation Group, which is one of the largest practice groups in Baker McKenzie. In addition to this, I am a Senior Partner in the firm based in the Frankfurt office. In this role, I advise many of the largest companies in the world on all labor and employment-related matters, particularly in relation to complex global reorganizations, which involves counselling clients

on employment issues arising from multi-jurisdictional mergers and acquisitions, divestitures and post-merger integrations. I also advise clients on international labor & human rights, industrial relations, and day-to-day HR management.

Can you tell us how the Global Employment & Compensation Group is organized? The practice group has approximately 700 lawyers across 47 countries. As Practice Chair, I

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lead the global steering committee, which is comprised of regional chairs from Asia Pacific, EMEA, Latin America and North America. As leaders of the practice group, we drive business strategy, quality service delivery, development of our product offering and brand development, as well as facilitating knowledge sharing. The global practice group is organized in a way that enables us to not only manage huge global projects across many jurisdictions working with multiple practice groups, but also to service domestic markets and provide expert advice at a local level.

What are the typical advantages of having a Global Practice Group? The main advantage of having a global practice group is that we can coordinate global projects for our clients from a single point of contact using our global network. As a result, our clients experience consistent, high quality and seamless service delivery from each office involved in a deal or matter. This integrated approach means our clients receive cost effective and efficiently managed legal services. This approach also manages our clientsâ&#x20AC;&#x2122; risk, as our lawyers are able to develop a full picture of a client's legal and strategic objectives and offer a tailored solution to achieve these. Internally, one of the major advantages of having a global practice group is that it facilitates knowledge sharing and drives innovation. Knowledge sharing also enables our lawyers to apply best practice when providing legal advice.

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Are there any Industry Groups? Yes, there are. The industry groups are led by lawyers from various practice groups and have a truly multi-disciplinary purpose. Our industry groups include Energy, Mining & Infrastructure, Environmental Financial Institutions, Healthcare, and IT & Communications. The lawyers involved in the industry groups combine their practice area expertise with their industry specific knowledge and collaborate to advise clients. This ensures that our clients can be confident the legal advice they receive takes into account the latest industry challenges and trends.

What are the global legal trends in the Employment world? One of the major global trends in the world of employment is International Labor and Human Rights. In the last 10 years, we have seen labor unions become more sophisticated in how they recruit, organize and pressure companies to implement labor and human rights standards. Prior to this shift, disputes between labor unions and their employers tended to be local issues. However, today these disputes have the ability to escalate quickly on a global scale. Failing to manage labor and human rights risks can not only cause potential harm to workers, but it can also have a significant, long lasting impact on businesses. We are currently talking to many of our clients about their labor and human rights strategy, and are working

with them to identify and eliminate risks within both their business and their supply chain. We are also seeing an increasing number of business change and restructuring projects. This can include mergers & acquisitions, spin offs, reductions in force and reorganizations. These business change projects are often driven by customer demand and a need to improve performance, improve efficiency and ultimately increase profitability. Identifying and managing HR issues at the earliest possible opportunity is often critical to the successful implementation of a business change project. Another trend I would like to highlight is the use of robotics and artificial intelligence (AI) in the workplace, which is increasing at a fast pace and will have massive implications for employers across a range of industries globally, particularly within the next decade.

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HIRING & FIRING LAW AND KEY EMPLOYMENT TRENDS IN GERMANY. KEY EMPLOYMENT TRENDS BY BERNHARD TRAPPEHL | EMPLOYMENT LAW OVERVIEW | COLLECTIVE DISMISSALS | PARTIES TO BE INVOLVED IN A COLLECTIVE DISMISSAL | COLLECTIVE DISMISSALS: HOW SHOULD VARIOUS PARTIES BE INVOLVED? | PERSONAL INTERVIEW BERNHARD TRAPPEHL 20

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https://commons.wikimedia.org/wiki/File:Berlin_Panorama_mit_Fernsehturm.jpg

JOHN, by the grace of God King of England, Lord of Ireland, Duke of Normandy and Aquitaine, and Count of Anjou, to his archbishops, bishops, abbots, earls, barons loyal subjects, Greeting. KNOW THAT BEFORE GOD, for the health of our soul and those of our ancestors and heirs, to the honour of God, the exaltation of the holy Ch fathers Stephen, archbishop of Canterbury, primate of all England, and cardinal of the holy Roman Church, Henry archbishop of Dublin, William bishop of London, P bishop of Lincoln, Walter bishop of Worcester, William bishop of Coventry, Benedict bishop of Rochester, Master Pandulf subdeacon and member of the papal househ William Marshal earl of Pembroke, William earl of Salisbury, William earl of Warren, William earl of Arundel, Alan of Galloway constable of Scotland, Warin fitz Gerald Matthew fitz Herbert, Thomas Basset, Alan Basset, Philip Daubeny, Robert de Roppeley, John Marshal, John fitz Hugh, and other loyal subjects: + (1) FIRST, THAT W for us and our heirs in perpetuity, that the English Church shall be free, and shall have its rights undiminished, and its liberties unimpaired. That we wish this so to be ob of the present dispute between us and our barons, we granted and confirmed by charter the freedom of the Church's elections - a right reckoned to be of the greatest Innocent III. This freedom we shall observe ourselves, and desire to be observed in good faith by our heirs in perpetuity. TO ALL FREE MEN OF OUR KINGDOM w out below, to have and to keep for them and their heirs, of us and our heirs: (2) If any earl, baron, or other person that holds lands directly of the Crown, for military serv the heir shall have his inheritance on payment of the ancient scale of 'relief'. That is to say, the heir or heirs of an earl shall pay £100 for the entire earl's barony, the heir that owes less shall pay less, in accordance with the ancient usage of 'fees'. (3) But if the heir of such a person is under age and a ward, when he comes of age he shall an heir who is under age shall take from it only reasonable revenues, customary dues, and feudal services. He shall do this without destruction or damage to men or pro person answerable to us for the revenues, and he commits destruction or damage, we will exact compensation from him, and the land shall be entrusted to two worthy revenues, or to the person to whom we have assigned them. If we have given or sold to anyone the guardianship of such land, and he causes destruction or damage, he and prudent men of the same 'fee', who shall be similarly answerable to us. (5) For so long as a guardian has guardianship of such land, he shall maintain the houses, pa the revenues of the land itself. When the heir comes of age, he shall restore the whole land to him, stocked with plough teams and such implements of husbandry as th Heirs may be given in marriage, but not to someone of lower social standing. Before a marriage takes place, it shall be made known to the heir's next-of-kin. (7) At her at once and without trouble. She shall pay nothing for her dower, marriage portion, or any inheritance that she and her husband held jointly on the day of his death. She m this period her dower shall be assigned to her.(8) No widow shall be compelled to marry, so long as she wishes to remain without a husband. But she must give security Crown, or without the consent of whatever other lord she may hold them of. (9) Neither we nor our officials will seize any land or rent in payment of a debt, so long a sureties shall not be distrained upon so long as the debtor himself can discharge his debt. If, for lack of means, the debtor is unable to discharge his debt, his sureties sh and rents until they have received satisfaction for the debt that they paid for him, unless the debtor can show that he has settled his obligations to them. * (10) If anyo been repaid, his heir shall pay no interest on the debt for so long as he remains under age, irrespective of whom he holds his lands. If such a debt falls into the hands o bond. * (11) If a man dies owing money to Jews, his wife may have her dower and pay nothing towards the debt from it. If he leaves children that are under age, the holding of lands. The debt is to be paid out of the residue, reserving the service due to his feudal lords. Debts owed to persons other than Jews are to be dealt with simi general consent, unless it is for the ransom of our person, to make our eldest son a knight, and (once) to marry our eldest daughter. For these purposes only a reasonable 'a + (13) The city of London shall enjoy all its ancient liberties and free customs, both by land and by water. We also will and grant that all other cities, boroughs, towns, the general consent of the realm for the assessment of an 'aid' - except in the three cases specified above - or a 'scutage', we will cause the archbishops, bishops, abbots who hold lands directly of us we will cause a general summons to be issued, through the sheriffs and other officials, to come together on a fixed day (of which at least fort the cause of the summons will be stated. When a summons has been issued, the business appointed for the day shall go forward in accordance with the resolution of thos In future we will allow no one to levy an 'aid' from his free men, except to ransom his person, to make his eldest son a knight, and (once) to marry his eldest daughter. F be forced to perform more service for a knight's 'fee', or other free holding of land, than is due from it. (17) Ordinary lawsuits shall not follow the royal court around d'ancestor, and darrein presentment shall be taken only in their proper county court. We ourselves, or in our absence abroad our chief justice, will send two justices to county elected by the county itself, shall hold the assizes in the county court, on the day and in the place where the court meets. (19) If any assizes cannot be taken on th remain behind, of those who have attended the court, as will suffice for the administration of justice, having regard to the volume of business to be done. (20) For a trivi offence, and for a serious offence correspondingly, but not so heavily as to deprive him of his livelihood. In the same way, a merchant shall be spared his merchandise, of a royal court. None of these fines shall be imposed except by the assessment on oath of reputable men of the neighbourhood. (21) Earls and barons shall be fined on fine imposed upon the lay property of a clerk in holy orders shall be assessed upon the same principles, without reference to the value of his ecclesiastical benefice. (23) with an ancient obligation to do so. (24) No sheriff, constable, coroners, or other royal officials are to hold lawsuits that should be held by the royal justices. * (25) Eve without increase, except the royal demesne manors. (26) If at the death of a man who holds a lay 'fee' of the Crown, a sheriff or royal official produces royal letters pat seize and list movable goods found in the lay 'fee' of the dead man to the value of the debt, as assessed by worthy men. Nothing shall be removed until the whole debt the dead man’s will. If no debt is due to the Crown, all the movable goods shall be regarded as the property of the dead man, except the reasonable shares of his wife an distributed by his next-of-kin and friends, under the supervision of the Church. The rights of his debtors are to be preserved. (28) No constable or other royal official payment, unless the seller voluntarily offers postponement of this. (29) No constable may compel a knight to pay money for castle-guard if the knight is willing to unde fit man to do it. A knight taken or sent on military service shall be excused from castle-guard for the period of this service. (30) No sheriff, royal official, or other per consent. (31) Neither we nor any royal official will take wood for our castle, or for any other purpose, without the consent of the owner. (32) We will not keep the lands after which they shall be returned to the lords of the 'fees' concerned. (33) All fish-weirs shall be removed from the Thames, the Medway, and throughout the whole of future be issued to anyone in respect of any holding of land, if a free man could thereby be deprived of the right of trial in his own lord's court. (35) There shall be stan kingdom. There shall also be a standard width of dyed cloth, russet, and haberject, namely two ells within the selvedges. Weights are to be standardised similarly. (36) In of life or limbs. It shall be given gratis, and not refused. (37) If a man holds land of the Crown by 'fee-farm', 'socage', or 'burgage', and also holds land of someone els land that belongs to the other person's 'fee', by virtue of the 'fee-farm', 'socage', or 'burgage', unless the 'fee-farm' owes knight's service. We will not have the guardians any small property that he may hold of the Crown for a service of knives, arrows, or the like. (38) In future no official shall place a man on trial upon his own unsupport No free man shall be seized or imprisoned, or stripped of his rights or possessions, or outlawed or exiled, or deprived of his standing in any way, nor will we proceed wit of his equals or by the law of the land. + (40) To no one will we sell, to no one deny or delay right or justice. (41) All merchants may enter or leave England unharme purposes of trade, free from all illegal exactions, in accordance with ancient and lawful customs. This, however, does not apply in time of war to merchants from a cou outbreak of war shall be detained without injury to their persons or property, until we or our chief justice have discovered how our own merchants are being treated in t too. * (42) In future it shall be lawful for any man to leave and return to our kingdom unharmed and without fear, by land or water, preserving his allegiance to us, ex realm. People that have been imprisoned or outlawed in accordance with the law of the land, people from a country that is at war with us, and merchants - who shall be holds lands of any 'escheat' such as the 'honour' of Wallingford, Nottingham, Boulogne, Lancaster, or of other 'escheats' in our hand that are baronies, at his death his he baron, had the barony been in the baron's hand. We will hold the 'escheat' in the same manner as the baron held it. (44) People who live outside the forest need not in summonses, unless they are actually involved in proceedings or are sureties for someone who has been seized for a forest offence. * (45) We will appoint as justices, realm and are minded to keep it well. (46) All barons who have founded abbeys, and have charters of English kings or ancient tenure as evidence of this, may have gu that have been created in our reign shall at once be disafforested. River-banks that have been enclosed in our reign shall be treated similarly. *(48) All evil customs relat or river-banks and their wardens, are at once to be investigated in every county by twelve sworn knights of the county, and within forty days of their enquiry the evil cu justice if we are not in England, are first to be informed. * (49) We will at once return all hostages and charters delivered up to us by Englishmen as security for peace the kinsmen of Gerard de Athée, and in future they shall hold no offices in England. The people in question are Engelard de Cigogné, Peter, Guy, and Andrew de Chance and his brothers, with Geoffrey his nephew, and all their followers. * (51) As soon as peace is restored, we will remove from the kingdom all the foreign knights, bowm with horses and arms. * (52) To any man whom we have deprived or dispossessed of lands, castles, liberties, or rights, without the lawful judgment of his equals, we w the judgment of the twenty-five barons referred to below in the clause for securing the peace (§61). In cases, however, where a man was deprived or dispossessed of som or our brother King Richard, and it remains in our hands or is held by others under our warranty, we shall have respite for the period commonly allowed to Crusaders, u before we took the Cross as a Crusader. On our return from the Crusade, or if we abandon it, we will at once render justice in full. * (53) We shall have similar respite or to remain forests, when these were first afforested by our father Henry or our brother Richard; with the guardianship of lands in another person's 'fee', when we have h party; and with abbeys founded in another person's 'fee', in which the lord of the 'fee' claims to own a right. On our return from the Crusade, or if we abandon it, we will be arrested or imprisoned on the appeal of a woman for the death of any person except her husband. * (55) All fines that have been given to us unjustly and against the l remitted or the matter decided by a majority judgment of the twenty-five barons referred to below in the clause for securing the peace (§61) together with Stephen, arch bring with him. If the archbishop cannot be present, proceedings shall continue without him, provided that if any of the twenty-five barons has been involved in a sim and sworn in his place, as a substitute for the single occasion, by the rest of the twenty-five. (56) If we have deprived or dispossessed any Welshmen of land, liberties their equals, these are at once to be returned to them. A dispute on this point shall be determined in the Marches by the judgment of equals. English law shall apply to ho Marches to those in the Marches. The Welsh shall treat us and ours in the same way. * (57) In cases where a Welshman was deprived or dispossessed of anything, w brother King Richard, and it remains in our hands or is held by others under our warranty, we shall have respite for the period commonly allowed to Crusaders, unless a we took the Cross as a Crusader. But on our return from the Crusade, or if we abandon it, we will at once do full justice according to the laws of Wales and the said regi and the charters delivered to us as security for the peace. * (59) With regard to the return of the sisters and hostages of Alexander, king of Scotland, his liberties and his unless it appears from the charters that we hold from his father William, formerly king of Scotland, that he should be treated otherwise. This matter shall be resolved by t that we have granted shall be observed in our kingdom in so far as concerns our own relations with our subjects. Let all men of our kingdom, whether clergy or laymen, o WE HAVE GRANTED ALL THESE THINGS for God, for the better ordering of our kingdom, and to allay the discord that has arisen between us and our barons, an strength, for ever, we give and grant to the barons the following security: The barons shall elect twenty-five of their number to keep, and cause to be observed with all charter. If we, our chief justice, our officials, or any of our servants offend in any respect against any man, or transgress any of the articles of the peace or of this secur they shall come to us - or in our absence from the kingdom to the chief justice - to declare it and claim immediate redress. If we, or in our absence abroad the chief jus the offence was declared to us or to him, the four barons shall refer the matter to the rest of the twenty-five barons, who may distrain upon and assail us in every way our castles, lands, possessions, or anything else saving only our own person and those of the queen and our children, until they have secured such redress as they have normal obedience to us. Any man who so desires may take an oath to obey the commands of the twenty-five barons for the achievement of these ends, and to join wit permission to take this oath to any man who so desires, and at no time will we prohibit any man from taking it. Indeed, we will compel any of our subjects who are unwi dies or leaves the country, or is prevented in any other way from discharging his duties, the rest of them shall choose another baron in his place, at their discretion, who the twenty-five barons on any matter referred to them for decision, the verdict of the majority present shall have the same validity as a unanimous verdict of the whol were unwilling or unable to appear. The twenty-five barons shall swear to obey all the above articles faithfully, and shall cause them to be obeyed by others to the best o efforts or those of a third party, anything by which any part of these concessions or liberties might be revoked or diminished. Should such a thing be procured, it shall through a third party. * (62) We have remitted and pardoned fully to all men any ill-will, hurt, or grudges that have arisen between us and our subjects, whether clergy o fully, and for our own part have also pardoned, to all clergy and laymen any offences committed as a result of the said dispute between Easter in the sixteenth year of ou letters patent to be made for the barons, bearing witness to this security and to the concessions set out above, over the seals of Stephen archbishop of Canterbury, Henry * (63) IT IS ACCORDINGLY OUR WISH AND COMMAND that the English Church shall be free, and that men in our kingdom shall have and keep all these liberties for them and their heirs, of us and our heirs, in all things and all places for ever. Both we and the barons have sworn that all this shall be observed in good faith and w by our hand in the meadow that is called Runnymede, between Windsor and Staines, on the fifteenth day of June in the seventeenth year of our reign (i.e. 1215: the new

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s, justices, foresters, sheriffs, stewards, servants, and to all his officials and hurch, and the better ordering of our kingdom, at the advice of our reverend Peter bishop of Winchester, Jocelin bishop of Bath and Glastonbury, Hugh hold, Brother Aymeric master of the knighthood of the Temple in England, d, Peter fitz Herbert, Hubert de Burgh seneschal of Poitou, Hugh de Neville, WE HAVE GRANTED TO GOD, and by this present charter have confirmed bserved, appears from the fact that of our own free will, before the outbreak necessity and importance to it - and caused this to be confirmed by Pope we have also granted, for us and our heirs for ever, all the liberties written vice, shall die, and at his death his heir shall be of full age and owe a 'relief', r or heirs of a knight 100s. at most for the entire knight's 'fee', and any man have his inheritance without 'relief' or fine. (4) The guardian of the land of operty. If we have given the guardianship of the land to a sheriff, or to any y and prudent men of the same 'fee', who shall be answerable to us for the shall lose the guardianship of it, and it shall be handed over to two worthy arks, fish preserves, ponds, mills, and everything else pertaining to it, from he season demands and the revenues from the land can reasonably bear. (6) r husband's death, a widow may have her marriage portion and inheritance may remain in her husband's house for forty days after his death, and within y that she will not marry without royal consent, if she holds her lands of the as the debtor has movable goods sufficient to discharge the debt. A debtor's hall be answerable for it. If they so desire, they may have the debtor's lands one who has borrowed a sum of money from Jews dies before the debt has of the Crown, it will take nothing except the principal sum specified in the eir needs may also be provided for on a scale appropriate to the size of his ilarly. * (12) No 'scutage' or 'aid' may be levied in our kingdom without its aid' may be levied. 'Aids' from the city of London are to be treated similarly. , and ports shall enjoy all their liberties and free customs. * (14) To obtain s, earls, and greater barons to be summoned individually by letter. To those ty days notice shall be given) and at a fixed place. In all letters of summons, se present, even if not all those who were summoned have appeared. * (15) For these purposes only a reasonable 'aid' may be levied. (16) No man shall d, but shall be held in a fixed place. (18) Inquests of novel disseisin, mort o each county four times a year, and these justices, with four knights of the e day of the county court, as many knights and freeholders shall afterwards ial offence, a free man shall be fined only in proportion to the degree of his , and a villein the implements of his husbandry, if they fall upon the mercy nly by their equals, and in proportion to the gravity of their offence. (22) A No town or person shall be forced to build bridges over rivers except those ery county, hundred, wapentake, and tithing shall remain at its ancient rent, tent of summons for a debt due to the Crown, it shall be lawful for them to t is paid, when the residue shall be given over to the executors to carry out nd children. * (27) If a free man dies intestate, his movable goods are to be shall take corn or other movable goods from any man without immediate ertake the guard in person, or with reasonable excuse to supply some other rson shall take horses or carts for transport from any free man, without his of people convicted of felony in our hand for longer than a year and a day, f England, except on the sea coast. (34) The writ called precipe shall not in ndard measures of wine, ale, and corn (the London quarter), throughout the future nothing shall be paid or accepted for the issue of a writ of inquisition e for knight's service, we will not have guardianship of his heir, nor of the ship of a man's heir, or of land that he holds of someone else, by reason of ed statement, without producing credible witnesses to the truth of it. + (39) th force against him, or send others to do so, except by the lawful judgment ed and without fear, and may stay or travel within it, by land or water, for untry that is at war with us. Any such merchants found in our country at the the country at war with us. If our own merchants are safe they shall be safe xcept in time of war, for some short period, for the common benefit of the dealt with as stated above - are excepted from this provision. (43) If a man eir shall give us only the 'relief' and service that he would have made to the n future appear before the royal justices of the forest in answer to general , constables, sheriffs, or other officials, only men that know the law of the uardianship of them when there is no abbot, as is their due. (47) All forests ting to forests and warrens, foresters, warreners, sheriffs and their servants, ustoms are to be abolished completely and irrevocably. But we, or our chief e or for loyal service. * (50) We will remove completely from their offices eaux, Guy de CigognĂŠ, Geoffrey de Martigny and his brothers, Philip Marc men, their attendants, and the mercenaries that have come to it, to its harm, will at once restore these. In cases of dispute the matter shall be resolved by mething without the lawful judgment of his equals by our father King Henry unless a lawsuit had been begun, or an enquiry had been made at our order, e in rendering justice in connexion with forests that are to be disafforested, hitherto had this by virtue of a 'fee' held of us for knight's service by a third l at once do full justice to complaints about these matters. (54) No one shall aw of the land, and all fines that we have exacted unjustly, shall be entirely hbishop of Canterbury, if he can be present, and such others as he wishes to ilar suit himself, his judgment shall be set aside, and someone else chosen s, or anything else in England or in Wales, without the lawful judgment of oldings of land in England, Welsh law to those in Wales, and the law of the ithout the lawful judgment of his equals, by our father King Henry or our a lawsuit had been begun, or an enquiry had been made at our order, before ions. * (58) We will at once return the son of Llywelyn, all Welsh hostages, s rights, we will treat him in the same way as our other barons of England, the judgment of his equals in our court. (60) All these customs and liberties observe them similarly in their relations with their own men. * (61) SINCE nd since we desire that they shall be enjoyed in their entirety, with lasting l their might, the peace and liberties granted and confirmed to them by this rity, and the offence is made known to four of the said twenty-five barons, stice, make no redress within forty days, reckoning from the day on which possible, with the support of the whole community of the land, by seizing determined upon. Having secured the redress, they may then resume their th them in assailing us to the utmost of his power. We give public and free illing to take it to swear it at our command. If one of the twenty-five barons o shall be duly sworn in as they were. In the event of disagreement among le twenty-five, whether these were all present or some of those summoned of their power. We will not seek to procure from anyone, either by our own be null and void and we will at no time make use of it, either ourselves or or laymen, since the beginning of the dispute. We have in addition remitted ur reign (i.e. 1215) and the restoration of peace. In addition we have caused archbishop of Dublin, the other bishops named above, and Master Pandulf. s, rights, and concessions, well and peaceably in their fullness and entirety without deceit. Witness the abovementioned people and many others. Given w regnal year began on 28 May).

Hiring & Firing law and key employment trends in Europe

Germany

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Key employment law trends in Germany One of the main trends in Germany concerns the promotion of so-called "good work". As such, the German unions and Ministry of Labor regard work in the so-called "first" labor market as opposed to temporary work. Another (positive) trend can be seen in the limitation of equal treatment/discrimination claims made by mock applicants.

Temporary work The German government is in the process of reforming the Temporary Work Act to strengthen temporary workers' protection and reduce the potential abuse of temporary work. We have seen in our daily practice that the deployment of external workers has become increasingly regulated and restricted. The draft bill on the reformation of the Temporary Work Act recently published by the Ministry of Labor and Social Affairs is still in the law-making process. The new regulations are expected to come into force as of January 1, 2017. According to the above-mentioned draft bill, the following (most important) regulations shall be implemented in the Labor Lease Act: · Maximum duration of 18 months

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According to the current regulation, temporary workers can only be leased on a "temporary" basis to the employer. The current law does not provide a fixed term which, in conjunction with varying case law, led to high uncertainty for the practice as to the legally permitted maximum duration (which is a critical issue as exceeding the maximum duration automatically leads to deemed employment with the borrower). Moreover, in the eyes of unions and the ministry of labor there has been a high potential for abuse of temporary work in the sense that companies used temporary workers (on a rolling basis) instead of hiring permanent employees for certain jobs. The new regulation sets a clear limit of 18 months. In case the 18-month duration is exceeded, the temporary worker will be deemed an employee of the borrower. ·E qual Pay Principle After nine months of deployment, temporary workers are entitled to the same wage and other substantial working conditions as the permanent staff employed by the borrower. Thus, the attractiveness of a labor lease shall be reduced and employers shall be incentivized to employ permanent employees instead of deploying external workers. ·N o temporary workers during strikes Companies must not hire temporary workers as strike-breakers in order to reduce the negative impacts of strikes on the operational procedures at their premises. This measure is aimed at strengthening the constitutional right to strike.

Minimum Wage Act and deductible additional benefits · Increase of minimum wage In 2015, the German government enacted the Minimum Wage Act with a minimum wage of EUR 8.50 gross per hour. The amount of the minimum wage is not cast in stone and will be reviewed and – if necessary – adjusted on a regular basis by a Minimum Wage Committee ("MWC"). The first revision took place recently and the MWC decided to increase the minimum wage from EUR 8.50 to EUR 8.84 gross per hour with effect from January 1, 2017. · Components being considered as wage

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We have observed a growing number of court proceedings concerning the calculation and components forming part of the minimum wage. According to case law, additional benefits (such as Christmas and holiday pay) are considered as wage in the sense of the Minimum Wage Act, provided that the additional benefits are paid as compensation in exchange for employees' work and the additional payments are paid on a pro-rated monthly basis. By contrast, voluntary payments, such as jubilee payments, etc., which are paid to honor employees' seniority, or mandatory payments, such as reimbursement of travel costs or training expenses, cannot be set off against the minimum wage. Abuse of the General Equal Treatment Act There is no longer a basis for fake job applications aimed at seeking compensation for discrimination. Background: A German individual sent numerous fake job applications to companies for the sole purpose of claiming compensation from employers who were rejecting his application for a trainee position due to "discrimination on the grounds of age and gender". According to the German Federal Court and following likewise the ECJ, compensation for discrimination based on age or gender requires more than just a formal job application. If it becomes evident that the job seeker has applied for a position for the mere purpose of claiming compensation for discrimination, one of the preconditions (i.e., there must be an "application for a job") is not satisfied for the mere reason that the candidate is not applying for a job but rather seeking compensation in a fraudulent manner.

Employment Law Overview I. Pre-Hire Considerations Pre-Hire Background/Reference Checks Permitted or Required Pre-hire background and reference checks are not required by law, and such checks are relatively uncommon in Germany. German law generally does not permit background checks into an applicant’s character or creditworthiness unless the position

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requires a certain level of trustworthiness (e.g., cashiers or security personnel). In that case, the applicant must additionally provide his/her consent to such check. It is common practice in Germany for an applicant to provide prospective employers with proof of his/ her education and reference letters from previous employers, together with the application.

Pre-Hire Medical Checks/Drug Testing Permitted or Required Pre-hire medical checks and/or drug testing are not required under applicable laws. Pre-hire medical checks and/or drug testing can be carried out with the job applicant’s consent, but an applicant generally cannot be required to undergo a medical check or a drug test unless it is necessary to assess the employee’s current ability to perform the job duties at issue.

II. Hiring and Employment Terms Written Employment Contract/PIIA; Language Requirements Indefinite-term employment contracts can be written or oral, explicit or implied, but it is common to have a written contract of employment. In case of a definiteterm employment contract, a written agreement that references the definite term must be signed by both parties prior to the employee’s start date. In any event, employees must be given the material terms and conditions of employment in writing within 1 month of the commencement of employment. Accordingly, a written employment contract (signed by both parties) is strongly advised before the employee’s start date to avoid arguments of impermissible unilateral changes to the employee’s terms and conditions of employment. Employment contracts do not have to be in German to be enforceable, but typically such contracts are either in German or bilingual to avoid claims that the employee did not understand the terms of the contract.

Definite vs. Indefinite Term/Part-Time Employees Employees can be hired for a definite or indefinite term.Any definite term employment contract needs to specify in writing the exact term of the contract or, if the term of the contract cannot be determined,

the detailed conditions upon which the contract shall terminate. A definite-term contract is only valid as such if agreed to in writing by both parties prior to the employee’s start date. Otherwise the employment relationship would be deemed to last for an indefinite term. Further, as a general rule, definite-term contracts may not be entered into if the employer is not able to give valid (i.e., legally recognized) reasons for the necessity of a specific duration limitation for the employment relationship. Without such valid reason, definite-term employment contracts can only be entered into for a limited duration of up to a maximum of 2 years, provided that the employee has not been employed with the company in the past. This means that, unless there is such valid reason, any prior employment with the company would prevent a valid definite-term contract.

unless they are reasonable in geographic scope and time, and are necessary to protect the legitimate business interests of the employer. In addition, an enforceable post-termination non-compete clause must be in writing, may not run for more than 2 years after termination of employment and must provide that the company will continue to compensate the former employee with at least 50% of the employee’s last remuneration during the entire non-compete period.

Within the above-mentioned 2-year period for which a definite-term contract can be entered into without a valid reason, the contract can be renewed up to 3 times, provided the renewal is agreed upon between the parties in writing before the end of each fixed term. It is very important that the terms and conditions of employment are not changed at the time of such renewal because the employment would then be deemed to be for an indefinite term. Definite-term employees may not be treated less favorably than indefinite-term employees, unless the treatment can be objectively justified.

The normal working week is between 36 to 40 hours, depending on the industry, and 5 days per week, excluding Saturdays and Sundays.

All employees can request to work part-time, provided they have been employed for more than 6 months and the employer employs more than 15 employees. The employees must submit their request for part-time employment at least 3 months in advance. Employees on parental leave can request a part-time arrangement under similar conditions. Part-time employees must not be treated less favorably than full-time employees with regard to salary, training or other benefits; although certain exceptions may be permitted on objective grounds.

Probationary Periods A probationary period is possible and customary, but must be agreed to in writing prior to the employee’s start date. Within a 6-month probationary period, either party may terminate the employment relationship by providing 2 weeks’ notice. Employees may be terminated for any non-discriminatory reason as the Termination Protection Act only applies after 6 initial months of employment.

Non-Compete/Non-Solicitation

The employer may also include language in the posttermination non-compete clause that prohibits the employee from soliciting customers, employees, or suppliers of the employer.

Working Hours

German law contains standards for periods of rest, working hours, night work, work on Sundays, rest breaks, overtime, and on-call shifts.

At-Will Employment At-will employment is not recognized in Germany. As such, unilateral changes to terms and conditions of employment are generally not permitted, and require express, voluntary employee consent. In the case of purely employee advantageous changes (e.g., pay rise) consent can be assumed. In all other cases it must be given explicitly. Further, for terms that were agreed with the works council (e.g., performance pay schemes), amendments will also require new consent by the works council.

III. Managing Employment Relationship Performance Appraisals There is no legal requirement to conduct performance appraisals during the employee’s term of employment, but in practice regular performance appraisals are common. While there is no specific statutory procedure for conducting performance appraisals, they may require the consent of the works council (e.g., if appraisal is required for determining payments based on variable compensation schemes), if any.

Post-termination non-compete restraints are permitted, but courts will not enforce such restraints

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Workplace Safety Rules (e.g., Posting and Consultation, Liability Insurance) Employers have a statutory stringent obligation to provide a safe working environment. Although the employer is not required to conduct specific risk assessments, the works council (if any) will usually monitor employer compliance with these requirements. There are several safety regulations. For instance, employers are obliged to make safety postings. For example, employers must post a copy of the German Working Time Act ("Arbeitszeitgesetz") and have to promote the German General Equal Treatment Act ("Allgemeines Gleichbehandlungsgesetz"). In companies with more than 20 employees, safety officers must be appointed by the employer (in cooperation with the works council, if any). Depending on the type of company, the employer has to appoint further officers such as an officer for emission control or a data protection officer. There is no need for a workplace safety policy but employers are obliged to inform employees about safety rules and have to issue instructions regarding work in particularly dangerous work areas.

Anti-Discrimination/Harassment Legislation Under Germany’s anti-discrimination laws, employers are prohibited to directly or indirectly discriminate against employees or applicants based on the following criteria: race or ethnic origin, sex, religion or secular belief, handicap, age or sexual identity. The prohibition also covers indirect discrimination, which refers to behavior that appears neutral at first glance but adversely impacts a particular protected group of employees. Different treatment of a protected group of employees may be justified by objective reasons under specific limited circumstances (e.g., if the job profile objectively requires certain skills, etc.). Any employer is legally obligated to take precautionary measures to avoid discrimination in its business, and therefore should inform its employees about Germany’s anti-discrimination laws. Doing so also better protects against related litigation.

Data Privacy Obligations German law provides for very stringent data privacy obligations. As a general rule, personal data can only be processed if it is either required for the performance of the employment contract, or if the employee has expressly consented to the use of his/ her personal data after having been comprehensively informed about the extent and purpose of the data

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processing. An employee’s consent is only sufficient if given voluntarily, however, there is some current legal dispute regarding whether an employee can give voluntary consent to the use of his/her personal data in the employment context.

Unions Trade unions are organizations that represent the individual and collective interests of its members (i.e., of employees who joined the union). The decision whether or not to join a union is voluntary. Trade unions negotiate and execute CBAs with the employer or the employers’ association.

Collective bargaining agreements (“CBAs”) Generally, CBAs contain provisions concerning remuneration and other conditions of employment (vacation, working time, exclusion provisions etc.). Generally, CBAs have legal effect only for the employees registered with the respective trade union.

Works Councils A works council may be established in a business unit having at least: (i) 5 permanent employees who are 18 years old or older and eligible to vote in a works council election; and (ii) 3 permanent employees who are eligible to run as candidates for the works council (i.e., who have been employed for at least 6 months). A permanent employee is an employee who is not employed as borrowed workforce under a labor lease contract.

Employee Representatives Representative body of executive staff. This is basically a quite limited works council for "executive employees." The representative body of executive staff may be established in a business unit having at least 10 executive employees (e.g., management employees).

IV. Mandatory Payments/ Benefits Compensation/Benefits (Bonuses, Benefits in Kind) Many employees are paid a 13th monthly salary, which is often paid before Christmas or with the employee’s November salary, as well as bonuses or commissions. Such compensation is not mandatory. However, if

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such payments are provided for in the employment contract, or have been promised orally, the employer may be contractually bound to continue payment also for future years. In the high-tech industry, paying a 13th monthly salary is less common. Some senior employees may receive "benefits in kind," such as company cars, medical and disability insurance, life insurance and private pensions (in addition to the mandatory pensions operated by the State). Such benefits are not mandatory as well and, if granted, they are generally subject to taxation. The corresponding taxes are borne by the employee. It is not recommended to transfer this liability to the employer as this triggers complicated tax implications.

Mandatory Vacation/Holiday Employees are entitled to an annual vacation of at least 24 working days based on a 6-day workweek, i.e., 20 working days based on a 5-day workweek. As a general rule, employers grant more than the legal minimum; vacation time of 25 through 30 working days (based on a 5-day workweek) is common.

Wages, including Mandatory Increases German law provides for a minimum wage of EUR 8.50 per work hour since the establishment of the Minimum Wage Act as of January 1, 2015. Basically, the Minimum Wage Act applies to all employees. However, it provides for several exemptions of which the following are the most important: 路 interns as long as the internship serves for educational or training purposes and the intern is not considered a "normal" employee (differentiation can be difficult); 路 employees at an age of up to 18 years without completed apprenticeship; 路 trainees and volunteers; and 路 employees who were in long-time unemployment (at least one year) prior to the commencement of the employment (this applies, however, only during the initial six months of the employment). A company is not only liable for the minimum wage to be paid to its own employees but also for all subcontractors if the company assigns sub-contractors (this applies to the entire chain of sub-contractors).

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Mandatory Leaves (e.g., Sick, Maternity or Parental Leave) Maternity leave For maternity leave, pregnant employees are released from work within the last 6 weeks of pregnancy and prohibited from working within 8 weeks afterwards. During this time maternity benefits are paid by the statutory health insurance. The employer is required to pay the difference between maternity benefits paid by the health insurance and the employeeâ&#x20AC;&#x2122;s last average daily net income.

Parental leave After the maternity leave, either parent is entitled to parental leave, which may extend up to 36 months and may be taken in up to 3 periods before the child reaches age 8. Moreover, employees can request the employer to enter into a part-time arrangement. Principally, the employer does not have to pay

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remuneration during the parental leave, except in cases of part-time arrangement. During such periods parental benefits are paid by the State.

Special occasions The employer must continue salary payment if the employee is absent from work for a short period of time to help care for a dependent in an emergency or for special occasions (e.g., wedding or childbirth). The absence may not exceed a few days, depending on the occasion.

Sick leave Employees are entitled to sick leave if they are unable to perform work as a result of their illness. The employer has to pay continued remuneration for a period of up to 6 weeks if the employment relationship lasted longer than 4 weeks. After a continued illness of more than 6 weeks, the employee may receive sick pay from its health insurer. There is

no fixed amount of sick days. The 6-week period for continued remuneration/sick pay generally starts anew for each sickness. As such, sick leave does not accrue.

A. Collective Dismissals When will collective dismissals be triggered? When in any 30 days an employer wants to dismiss the following number of employees: · more than 5 employees in a business unit with more than 20 and less than 60 employees; · 10% of all, or more than 25 employees in a business unit with at least 60 and less than 500 employees; or · at least 30 employees in a business unit with at least 500 employees.

Do you need to inform/consult? If so, with whom? e.g. works council, trade unions, elected reps, individual employee. Yes. The employer’s obligation to inform/consult with the works council is twofold: ·U nder the relevant provision on collective dismissals, the employer must inform and consult the works council (for more details, please see below). · I n addition, collective dismissals usually trigger codetermination rights under the Works Constitution Act. These co-determination rights require employers to inform and consult with the works council on the proposed collective dismissal (and reorganizational measures connected with the same) with the aim of concluding an agreement on whether/how the measure will be implemented. (Equalization of Interest Agreement) and how its effects can be mitigated (Social Plan). In addition to the above, the provisions on collective redundancies also require that the local Employment Office be informed about the proposed measure and of the works councils’ view on same.

What do you need to inform/ consult about? Information As outlined above, the employer must inform the works council about: · the reasons for the planned dismissals; · the number and occupational group of the employees to be dismissed; · the number and occupational group of the employees regularly employed, · the period of time over which these dismissals are to take place; · the intended criteria for the selection of the employees to be dismissed; and · the criteria for calculating any severance payments. In addition, the employer must inform the local Employment Office. The adherence to these procedures is critical. Formalities have to be obeyed. It is essential to assess these obligations within the framework of the intended measures.

Consultation The employer has to consult with the works council on ways in which the dismissals can be prevented or limited and how the consequences of the dismissals can be mitigated. As outlined above, collective dismissals usually trigger co-determination rights: · The employer and Works Council shall attempt to reach an Equalization of Interest Agreement regarding the proposed operational change. · If agreement on the necessity of the measure as planned by the employer cannot be obtained, either the issue may be brought before the President of the Regional Labor Office as mediator, whose decision may be appealed to the conciliation board or, if neither party moves for mediation, the question may be taken directly to the conciliation board. · Ultimately, however, neither the Works Council nor the conciliation board has the power to force an agreement upon the employer. · Up to this stage the Works Council only has a right to be consulted but the employer's measure as such does not depend on the consent of the Works Council.

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Âˇ A nother agreement to be reached between management and Works Council in connection with the operational change is the so-called Social Plan. Âˇ The same procedural steps have to be followed as in case of the equalization of interest agreement.

What sanctions/penalties are there for failing to inform/consult? Failure to follow the correct procedure will make any notices of termination null and void.

Are any other government or official approvals required? Not specifically for collective redundancies. Please note, however, that government approval may be required for other reasons e.g. if the employee to be made redundant enjoys special protection against termination and can only be terminated with government approval (as would be the case for employees on parental leave or employees who are recognized as severely disabled).

Collective dismissal parties involved Parties

Germany

Supervisory Board

N/A

Works Council

Required

Trade Unions

Required

Content of a social plan Severance payments depending on age, seniority and salary Outplacement, training and coaching (optional) Old age part-time arrangements and early retirements (optional) Additional severance for handicapped employees or for minor children (optional)

Collective Dismissals: How should the various parties be involved a) Supervisory Board

Governmental Body

Required

Court

If applicable

Depending on the significance of the measure, the Supervisory Board has to be informed. If a publicly listed company considers a mass dismissal, the capital market must be informed.

b) Works Council (if any)

The Works Council has to be involved at various stages:

a) If the considered mass dismissal results in a substantial reorganization, the employer has to inform the Works Council at the earliest

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stage possible. This might result in negotiations concerning an equalization of interest agreement and a social plan (please see below). b) Whether or not the mass dismissal may be deemed a substantial change of business, the Works Council has to be informed in writing and in a timely manner (at least two weeks prior to informing the Labor Office, please see below) of, in particular, 1. the reasons for the planned dismissals; 2. the number and occupational group of the employees to be dismissed; 3. the number and occupational group of the employees regularly employed; 4. the period of time over which these dismissals are to take place; 5. the intended criteria for the selection of the employees to be dismissed; and 6. the criteria for calculating any severance payments. The employer and the Works Council have to discuss ways in which the dismissals can be prevented or limited and their consequences can be mitigated. Both parties are not required to enter into an agreement, however, the employer is obliged to give evidence of the discussions. c) Please note that the Works Council must be heard prior to every dismissal, and must be given a weekâ&#x20AC;&#x2122;s time to consider the issue. The employer may only issue the termination thereafter. If the employer does not hear the Works Council prior to giving notice or if the employer does not provide the Works Council with complete and accurate information concerning the grounds for dismissal, the termination is null and void for formal reasons.

c) Trade Unions If the employer is bound by a collective bargaining agreement, the employer has to comply with the provisions of such agreement. This may result in necessary negotiations with a Trade Union, especially in case of existing site protection agreements (Standortsicherungsvertrag), (temporary) no-termination agreements, or other similar types of agreements.

d) Equalization of Interest and Social Plan Depending on the significance of the measure, mass dismissals may be deemed as a major operational change.

As outlined above, once management starts to seriously consider a substantial reorganization, it has to inform the Works Council as soon as possible. The information phase leads over into a negotiation phase during which the employer and Works Council shall attempt to reach an Equalization of Interest Agreement (Interessenausgleich) regarding the proposed operational change. If agreement on the necessity of the measure as planned by management cannot be obtained, either the issue may be brought before the President of the Regional Labor Office as mediator, whose decision may be appealed to the conciliation board (Einigungsstelle) or, if neither party moves for mediation, the question may be taken directly to the conciliation board. Ultimately, however, neither the Works Council nor the conciliation board has the power to force an agreement upon the employer. Up to this stage, the Works Council only has a right to be consulted but the management measure as such does not depend on the consent of the Works Council. However, by making use of legal rights during the negotiation process, the Works Council may potentially and significantly delay the implementation of the planned operational change. Another agreement to be reached between the management and Works Council in connection with the operational change is the so-called Social Plan (Sozialplan). The same procedural steps have to be followed as in case of the equalization of interest agreement. Thus, the management and Works Council first negotiate and, if they fail to reach an agreement, they may call for mediation by the President of the Regional Labor Agency or go directly to the conciliation board. Failing agreement on a prior level, the conciliation board has the power to render a final and binding decision regarding the contents of the social plan. The obligations of the management in respect of the social plan are therefore not confined to attempting to seek agreement with the right to take action once such attempt proves to be without success. Rather, the Works Council has a full substantive co-determination right in that its consent must be obtained and, if no agreement can be reached, the conciliation board renders a decision. In practice, the equalization of interest agreement and the social plan are ordinarily pursued simultaneously, and the Works Council attempts to obtain the best personal package for the affected work force.

e) Governmental Body (Labor Agency) Before the notice letters for mass dismissals can be issued, the employer must discuss its intention to dismiss the number of employees with the Works Council. In addition, the employer must inform the local Labor Agency (Agentur fĂźr Arbeit). Adherence

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to these procedures is critical. Formalities have to be obeyed. It is essential to assess these obligations within the framework of the intended measures.

agreed in the employment contract or the statutory minimum notice period, what ever is more beneficial to the employee in the case at hand.

As a rule, the terminations cannot become effective earlier than one month after the information is filed with the local Labor Agency. Additionally, according to the “Junk” decision of the European Court of Justice, notice letters may only be issued and served after the local employment office has been informed of the contemplated mass dismissal.

The basic statutory notice period is 4 weeks to the 15th or the end of a calendar month. Under applicable laws, longer notice periods may apply depending on the employee's length of service. For example:

B. Individual Dismissals On what grounds can you legitimately justify the dismissal of an individual employee? After the first 6 months of employment, an employee who works in a business unit employing on average more than 10 employees is automatically entitled to termination protection under the Termination Protection Act. If the Termination Protection Act applies, employers must show "justified grounds" for terminating an employee. Under the Act, employees can only be terminated if the grounds for termination fall within one of the following three categories: · Employee's conduct, · Employee's personal condition, or · Economic reasons Any employee can be terminated for cause without notice (i.e., with immediate effect), provided that the employer has an "important reason" for the termination. "Important reasons" amount to grounds for termination for cause where the employee's actions are so grave and severe that the employer cannot reasonably be expected to continue the employment through the notice period.

Do you need to give notice of termination? If so, how long? Regardless of whether a termination is due to redundancy or not, after the probationary period, the employment can normally only be terminated by providing the employee with the applicable notice period. This is the notice period

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·B etween 2 and 5 years of service, the notice period is 1 month to the end of a calendar month; ·B etween 5 and 8 years of service, the notice period is 2 months to the end of a calendar month; ·B etween 8 and 10 years of service, the notice period is 3 months to the end of a calendar month; ·B etween 10 and 12 years of service, the notice period is 4 months to the end of a calendar month; ·B etween 12 and 15 years of service, the notice period is 5 months to the end of a calendar month; · Between 15 and 20 years of service, the notice period is 6 months to the end of a calendar month; and · After 20 years of service, the notice period is 7 months to the end of a calendar month. In case of a termination for cause without notice, the employer must issue the termination letter for cause within 2 weeks after learning of the facts giving rise to the termination.

Are employees entitled to severance compensation? If so, how much? There is no statutory severance in Germany. Employees are only entitled to severance payments under a social plan with the works council or under a collective bargaining agreement. In practice, many employers and employees will agree on severance pay provisions. The severance will often approximately amount to 50% up to 150% of the monthly salary per year of service.

Do you need to involve any collective or official bodies when dismissing an individual employee?

If a works' council exists in the relevant business unit, it must be notified and heard before implementing any termination. Furthermore, governmental approval

may be required for other reasons e.g. if the employee to be made redundant enjoys special protection against termination and can only be terminated with governmental approval (please see above)

What sanctions/penalties are there for getting it wrong? The threshold for the effectiveness of a termination is quite high. The burden of proof is on the employer and the employees can challenge a termination before the court. If the termination is not effective the employee must be reinstated and is entitled to pay back starting from the end of the notice period.

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Claude Debussylaan 54 1082 MD Amsterdam â&#x20AC;¢

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A closer look

Why did you choose to work at Baker McKenzie? Bernhard Trappehl

What is your role within Baker McKenzie?

I am an employment law specialist in Baker McKenzie's Munich office. Prior to joining Baker McKenzie, I first gained working experience with Germany's Privatization Organization (Treuhandanstalt) which was in charge of the privatization of the former state-owned East German companies. My job was to support the companies in the necessary dramatic headcount reductions and to negotiate the financial terms of severance payments with the unions. I joined Baker McKenzie in 1996 at our Frankfurt office, was seconded to our London office for seven months in 1999 and, since the end of 1999, I have been in the employment team at Baker McKenzie's Munich office, which I am heading. I am advising large multinational corporations in complex employment matters such as restructurings, reorganizations, disputes with works councils and unions, compliance and outsourcing matters, etc. I am a member of Baker McKenzie's EMEA Employment Steering Committee and am the Key Account Manager for several global client relationships. Between 2007 and 2012, I was Managing Partner of Baker McKenzie's German and Austrian offices.

Through my previous work at the Privatization Organization, I came into contact with Baker McKenzie through the daughter of one of Baker McKenzieÂ´s former name partners in Germany. She advocated successfully for the big international law firm where her father was an IP partner, mentioning that it was in need of an experienced employment lawyer just like me. I felt honored and decided to send my CV to Baker McKenzie and, shortly thereafter, was invited to an interview at the Frankfurt office. When walking through the office hallways, I saw many lawyers in skiing outfits, which made me scratch my head and wonder where I had landed. When I learned that the Frankfurt lawyers were regularly meeting with the Zurich lawyers for a ski outing in the Swiss Alps, my decision to join Baker McKenzie was immediately made.

What is a typical day at the office like for you?

Whilst I am frequently traveling, one of the rare typical office days normally starts at around 8 a.m. I usually conduct multiple conference calls during the day. In between, I work on client matters and, still being a dictation freak, I produce lots of sound files dictating emails, memos and advice to my secretary (I am terrible at typing, which is why I even dictated my entire doctors thesis). Except for client lunches, I usually skip lunch break in order to enjoy the slower time

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around noon to concentrate on client work. The afternoon is usually filled with calls and meetings. In the evening, I try to leave at a time allowing me to still see my family awake and, once they are in bed, I usually go back to my home office desk to do some emails or calls.

What do you like best about your job?

I like working with people. This includes my employment law colleagues around the world as well as my colleagues from other practices throughout our global network. I particularly like advising clients in strategic decisions and enjoy being a sounding board for them in their considerations about which decision to take and which risk to take or to better avoid. What I particularly enjoy at Baker McKenzie is the fact that we are working with people from different regions and different cultures and with different linguistic backgrounds. Being in touch with so many wonderful, different individuals opens my view and is a daily pleasure.

What's your greatest accomplishment? One day, a client sent me an email asking a question as to whether or not he could proceed in a certain direction with respect to a senior employee, adding that he was expecting a lawyer to say "this will probably not work". I gave him very a clear and concise instructions advising what I would do if I were in his shoes. My advice was to go even beyond what the client had suggested. His response was: "Bernhard, this is the first response I have received from a lawyer in the past 15 years which I really like".

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his archbishops, bishops, abbots, earls, barons, justices, foresters, sheriffs, stewards, servants, and to all his officials d loyal subjects, Greeting. KNOW THAT BEFORE GOD, for the health of our soul and those of our ancestors and irs, to the honour of God, the exaltation of the holy Church, and the better ordering of our kingdom, at the advice of r reverend fathers Stephen, archbishop of Canterbury, primate of all England, and cardinal of the holy Roman Church, nry archbishop of Dublin, William bishop of London, Peter bishop of Winchester, Jocelin bishop of Bath and astonbury, Hugh bishop of Lincoln, Walter bishop of Worcester, William bishop of Coventry, Benedict bishop of chester, Master Pandulf subdeacon and member of the papal household, Brother Aymeric master of the knighthood the Temple in England, William Marshal earl of Pembroke, William earl of Salisbury, William earl of Warren, William rl of Arundel, Alan of Galloway constable of Scotland, Warin fitz Gerald, Peter fitz Herbert, Hubert de Burgh seneschal Poitou, Hugh de Neville, Matthew fitz Herbert, Thomas Basset, Alan Basset, Philip Daubeny, Robert de Roppeley, hn Marshal, John fitz Hugh, and other loyal subjects: + (1) FIRST, THAT WE HAVE GRANTED TO GOD, and by s present charter have confirmed for us and our heirs in perpetuity, that the English Church shall be free, and shall ve its rights undiminished, and its liberties unimpaired. That we wish this so to be observed, appears from the fact that our own free will, before the outbreak of the present dispute between us and our barons, we granted and confirmed charter the freedom of the Church's elections - a right reckoned to be of the greatest necessity and importance to it nd caused this to be confirmed by Pope Innocent III. This freedom we shall observe ourselves, and desire to be served in good faith by our heirs in perpetuity. TO ALL FREE MEN OF OUR KINGDOM we have also granted, for and our heirs for ever, all the liberties written out below, to have and to keep for them and their heirs, of us and our irs: (2) If any earl, baron, or other person that holds lands directly of the Crown, for military service, shall die, and at death his heir shall be of full age and owe a 'relief', the heir shall have his inheritance on payment of the ancient scale 'relief'. That is to say, the heir or heirs of an earl shall pay £100 for the entire earl's barony, the heir or heirs of a knight 0s. at most for the entire knight's 'fee', and any man that owes less shall pay less, in accordance with the ancient usage 'fees'. (3) But if the heir of such a person is under age and a ward, when he comes of age he shall have his inheritance thout 'relief' or fine. (4) The guardian of the land of an heir who is under age shall take from it only reasonable venues, customary dues, and feudal services. He shall do this without destruction or damage to men or property. If we ve given the guardianship of the land to a sheriff, or to any person answerable to us for the revenues, and he commits struction or damage, we will exact compensation from him, and the land shall be entrusted to two worthy and prudent n of the same 'fee', who shall be answerable to us for the revenues, or to the person to whom we have assigned them. we have given or sold to anyone the guardianship of such land, and he causes destruction or damage, he shall lose the ardianship of it, and it shall be handed over to two worthy and prudent men of the same 'fee', who shall be similarly swerable to us. (5) For so long as a guardian has guardianship of such land, he shall maintain the houses, parks, fish eserves, ponds, mills, and everything else pertaining to it, from the revenues of the land itself. When the heir comes age, he shall restore the whole land to him, stocked with plough teams and such implements of husbandry as the ason demands and the revenues from the land can reasonably bear. (6) Heirs may be given in marriage, but not to meone of lower social standing. Before a marriage takes place, it shall be made known to the heir's next-of-kin. (7) At r husband's death, a widow may have her marriage portion and inheritance at once and without trouble. She shall pay thing for her dower, marriage portion, or any inheritance that she and her husband held jointly on the day of his death. e may remain in her husband's house for forty days after his death, and within this period her dower shall be assigned her.(8) No widow shall be compelled to marry, so long as she wishes to remain without a husband. But she must give curity that she will not marry without royal consent, if she holds her lands of the Crown, or without the consent of atever other lord she may hold them of. (9) Neither we nor our officials will seize any land or rent in payment of a bt, so long as the debtor has movable goods sufficient to discharge the debt. A debtor's sureties shall not be distrained on so long as the debtor himself can discharge his debt. If, for lack of means, the debtor is unable to discharge his bt, his sureties shall be answerable for it. If they so desire, they may have the debtor's lands and rents until they have ceived satisfaction for the debt that they paid for him, unless the debtor can show that he has settled his obligations to em. * (10) If anyone who has borrowed a sum of money from Jews dies before the debt has been repaid, his heir shall y no interest on the debt for so long as he remains under age, irrespective of whom he holds his lands. If such a debt ls into the hands of the Crown, it will take nothing except the principal sum specified in the bond. * (11) If a man dies

Baker McKenzie labor & employment lawyers

wing money to Jews, his wife may have her dower and pay nothing towards the debt from it. If he leaves children that e under age, their needs may also be provided for on a scale appropriate to the size of his holding of lands. The debt to be paid out of the residue, reserving the service due to his feudal lords. Debts owed to persons other than Jews are be dealt with similarly. * (12) No 'scutage' or 'aid' may be levied in our kingdom without its general consent, unless is for the ransom of our person, to make our eldest son a knight, and (once) to marry our eldest daughter. For these rposes only a reasonable 'aid' may be levied. 'Aids' from the city of London are to be treated similarly. + (13) The city London shall enjoy all its ancient liberties and free customs, both by land and by water. We also will and grant that other cities, boroughs, towns, and ports shall enjoy all their liberties and free customs. * (14) To obtain the general nsent of the realm for the assessment of an 'aid' - except in the three cases specified above - or a 'scutage', we will use the archbishops, bishops, abbots, earls, and greater barons to be summoned individually by letter. To those who ld lands directly of us we will cause a general summons to be issued, through the sheriffs and other officials, to come gether on a fixed day (of which at least forty days notice shall be given) and at a fixed place. In all letters of summons, e cause of the summons will be stated. When a summons has been issued, the business appointed for the day shall go rward in accordance with the resolution of those present, even if not all those who were summoned have appeared. * 5) In future we will allow no one to levy an 'aid' from his free men, except to ransom his person, to make his eldest n a knight, and (once) to marry his eldest daughter. For these purposes only a reasonable 'aid' may be levied. (16) No an shall be forced to perform more service for a knight's 'fee', or other free holding of land, than is due from it. (17) rdinary lawsuits shall not follow the royal court around, but shall be held in a fixed place. (18) Inquests of novel sseisin, mort d'ancestor, and darrein presentment shall be taken only in their proper county court. We ourselves, or in r absence abroad our chief justice, will send two justices to each county four times a year, and these justices, with four ights of the county elected by the county itself, shall hold the assizes in the county court, on the day and in the place here the court meets. (19) If any assizes cannot be taken on the day of the county court, as many knights and freeholders all afterwards remain behind, of those who have attended the court, as will suffice for the administration of justice, ving regard to the volume of business to be done. (20) For a trivial offence, a free man shall be fined only in proportion the degree of his offence, and for a serious offence correspondingly, but not so heavily as to deprive him of his velihood. In the same way, a merchant shall be spared his merchandise, and a villein the implements of his husbandry, they fall upon the mercy of a royal court. None of these fines shall be imposed except by the assessment on oath of putable men of the neighbourhood. (21) Earls and barons shall be fined only by their equals, and in proportion to the avity of their offence. (22) A fine imposed upon the lay property of a clerk in holy orders shall be assessed upon the me principles, without reference to the value of his ecclesiastical benefice. (23) No town or person shall be forced to ild bridges over rivers except those with an ancient obligation to do so. (24) No sheriff, constable, coroners, or other yal officials are to hold lawsuits that should be held by the royal justices. * (25) Every county, hundred, wapentake, d tithing shall remain at its ancient rent, without increase, except the royal demesne manors. (26) If at the death of a an who holds a lay 'fee' of the Crown, a sheriff or royal official produces royal letters patent of summons for a debt e to the Crown, it shall be lawful for them to seize and list movable goods found in the lay 'fee' of the dead man to the lue of the debt, as assessed by worthy men. Nothing shall be removed until the whole debt is paid, when the residue all be given over to the executors to carry out the dead man’s will. If no debt is due to the Crown, all the movable ods shall be regarded as the property of the dead man, except the reasonable shares of his wife and children. * (27) If free man dies intestate, his movable goods are to be distributed by his next-of-kin and friends, under the supervision the Church. The rights of his debtors are to be preserved. (28) No constable or other royal official shall take corn or her movable goods from any man without immediate payment, unless the seller voluntarily offers postponement of is. (29) No constable may| Hiring compel& aFiring knight to pay2017 money for castle-guard if the knight is willing to undertake the guard 46 BMK | januari person, or with reasonable excuse to supply some other fit man to do it. A knight taken or sent on military service shall excused from castle-guard for the period of this service. (30) No sheriff, royal official, or other person shall take rses or carts for transport from any free man, without his consent. (31) Neither we nor any royal official will take ood for our castle, or for any other purpose, without the consent of the owner. (32) We will not keep the lands of people nvicted of felony in our hand for longer than a year and a day, after which they shall be returned to the lords of the es' concerned. (33) All fish-weirs shall be removed from the Thames, the Medway, and throughout the whole of

JUST ONE DAY

BMK | Hiring & Firing | januari 2017

HIRING & FIRING LAW AND KEY EMPLOYMENT TRENDS IN ITALY. KEY EMPLOYMENT TRENDS BY MASSIMILIANO BIOLCHINI | EMPLOYMENT LAW OVERVIEW | COLLECTIVE DISMISSALS | PARTIES TO BE INVOLVED IN A COLLECTIVE DISMISSAL | COLLECTIVE DISMISSALS: HOW SHOULD VARIOUS PARTIES BE INVOLVED? | PERSONAL INTERVIEW MASSIMILIANO BIOLCHINI 48

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Hiring & Firing law and key employment trends in Europe

Italy

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Key employment law trends in Italy Italian employment law has been radically overhauled starting from March 2015 and is still undergoing very significant changes, with a view to making employment simpler, cheaper and more business-friendly.

Amended dismissal law (so-called "Jobs Act") Amongst the most crucial changes, there is the Jobs Act concerning protection against dismissals. Employers are now free to dismiss employees with little or no concern around the unfair dismissal indemnity that employees may be awarded by Courts. In fact, the amended law provides, briefly summarized, that in the event of unfair dismissal, employees may be granted a pre-determined indemnity which depending on the employer's headcount - is equal to one or two monthly salaries multiplied by the employee's years of seniority (within a minimum cap of two or four monthly salaries and a maximum of six or twenty-four depending on headcount). Reinstatement is thus relegated to the (rare) cases of discriminatory dismissal (regardless of business size) and to the most serious cases of unfair disciplinary dismissal (essentially consisting of the patent inexistence of the facts grounding the dismissal) committed by larger businesses. The Jobs Act also introduced an expedient by which an employer, whilst dismissing employees, may also offer them a sort of pre-litigation settlement offer (parameterized on employee seniority and exempt from taxes and social security levies) in exchange for the prompt execution of a settlement agreement avoiding any future

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litigation. Employers are thus broadly benefitting from such changes and enthusiastically engaging in new hires as they are becoming increasingly aware of their greater freedom in later dismissing them with limited (if not, no) risk of litigation (and, in any event, with capped unfair dismissal indemnities).

Amended law on demotion Until recently, demotion (and related decrease in salary) was basically impossible without incurring into the risk of claims by employees. However, the recent employment law reform also relaxed the requirements of demotion. Employers are now at liberty to assign lower duties to employees in the event of changes to the business organization that directly affect their positions (provided that the new duties belong to the immediately lower classification level and that they do not decrease their salary). In addition, employers may change employees' duties and classification (category and level) and decrease their salary, provided that they reach an individual agreement with them, showing that demotion is made in the employees' interests (i.e. job retention, professional development, life balance).

Amended law on working tools A little less than a year ago, a new law entered in force and relaxed the requirements for the use of working tools (such as computers, mobile phone, tablets, etc.) provided by employers to employees for performance of their working duties. An internal policy regulating the use of such tools by employees and ensuring the protection of their personal data (as well as of the business's) is now sufficient in order for the employer to lawfully provide employees with said instruments and no specific agreement with the works councils (if any) or prior authorization by the local labor office is required any longer. In fact, the latter are now relegated only to CCTVs and other instruments through which employers may indirectly remotecontrol their employees (these more "intrusive" instruments are only allowed for business reasons such as protection of corporate property and employee health & safety). The above undoubtedly is another sign of modernization of the Italian jurisdiction and greater openness to contemporary employers who hand out up-to-date (and often even futurist) IT devices to their employees to accommodate their working needs.

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Law proposal on smart-working The Parliament is currently evaluating a Governmental law proposal on smart working, according to which employers may establish this increasingly cherished work modality through a simple written agreement, providing for the possibility of performing work not only from employees' homes but also from any other location (e.g. shared rented offices) through the use of the necessary IT instruments that employers shall readily make available. Other than ensuring the fair economic and legal treatment of smart workers, the law proposal looks very attractive whereby it allows employers to tailor and implement ad hoc disciplinary codes on the particular profile of the smart worker and to pre-determine the most effective ways of exercising their controlling powers on the proper performance of duties discharged outside corporate premises. Hopefully - after lengthy discussions on the subject matter - the law proposal shall soon enter in force and allow Italian employers to rely on another up-to-date instrument to manage employment relationships more efficiently.

Health & safety at the workplace Compliance with Italian Health & safety law remains a "big" topic in Italy. More and more frequently employers undergo inspections from public officers from the local labor and health authorities to check whether employers are compliant with the whole set of detailed provisions on this particular subject matter. Although complicated, employers' health & safety obligations may easily be mastered through a proper delegation of corporate powers within the business and the guidance of external technical experts.

Employment Law Overview I. Pre-Hire Considerations Pre-Hire Background/Reference Checks Permitted or Required Pre-hire background and reference checks are generally not permitted by law.

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Some types of checks, including credit checks (e.g., checks on education history, employment history and professional licenses), are permissible, with various limitations, and provided that the candidate expressly consents to such check and the data is (i) publicly available, (ii) directly relevant to the prospective job position and duties, (iii) used only for the purposes for which it was collected (i.e., assessment of the candidateâ&#x20AC;&#x2122;s fitness for the role and of the soundness of his/her profile).

Pre-Hire Medical Checks/Drug Testing Permitted or Required Pre-hire medical checks are generally permitted to check the physical and psychological fitness of the candidate to carry out the prospective duties inherent to the position in question (and are mandatory upon the actual hire of the applicant under Italian health and safety law), but must be performed by the Public Health Service or by the Company Physician at the employerâ&#x20AC;&#x2122;s request. Drug tests are typically prohibited. The only exception applies to job areas where there is a serious risk of transmission of the virus (e.g., in the medical sector) or if employees perform duties that are dangerous for their personal health and safety or for that of third parties.

II. Hiring and Employment Terms Written Employment Contract/PIIA; Language Requirements Employment contracts can be written, oral, express or implied. In any event, the employer is under a statutory obligation to inform employees in writing of the terms and conditions of employment within 30 days of the start of their employment at the latest. In addition, the employer is under a statutory obligation to provide certain clauses in writing under the penalty of nullity (e.g., probationary period, fixed-term duration of employment, non-compete and nonsolicitation clauses, etc.). In Italy, it is absolute common practice for both parties to conclude and sign a written employment contract. Employment contracts do not have to be in Italian to be enforceable in Italy and can be in English as long as the employee understands the content of the contract and its implications. If, however, the employee does not understand English, the employer should provide the employee with an Italian translation of the

employment contract to mitigate the risk of claims on grounds of language discrimination and to be able to defend its position in the event of disputes with the employee. In addition, in case documents written in a foreign language must be filed with judicial authorities, an Italian certified translation is likely to be necessary. For the reasons above, a bilingual Italian/English employment contract is generally recommended.

Definite vs. Indefinite Term/Part-Time Employees Employees can be hired on a fixed/definite-term basis for a temporary period. If no fixed term is specified in the employment contract, the contract is deemed to have been entered into for an indefinite period of time. There is no legal requirement to express the reasons determining the need to hire the employee on a fixed/definite term. A fixed/definite-term contract can have a maximum duration of 36 months. If the original term is shorter than 36 months, it can be extended up to 5 times (although within the maximum limit of 36 months), provided that: (a) the extension relates to the same work duties for which the original contract was entered into; (b) the overall duration of 36 months is observed; and (c) the employee consents to the extension.

Fixed/definite-term employees are entitled to receive the same economic and statutory treatment per the applicable CBA which is granted to indefinite employees with an equivalent contractual classification, according to the principle of nondiscrimination. Unless otherwise provided by the CBA applied by the employer, an employer can hire a maximum of fixed/ definite-term employees, which is equal to 20% of the indefinite employees who are in force as of January 1 of the year in which fixed/definite-term employees are hired. Specific rules apply to fixed/definite-term contracts concluded with executives (i.e., "dirigenti", who are the highest-ranked employees under Italian law).

Probationary Periods A probationary period is possible for employment contracts that are entered into for an indefinite and for a fixed/definite period of time (although in this case the length of the probationary period must be re-assessed based on the length of the fixed/definiteterm). The duration depends on the contractual classification of the employee under the applicable CBA (up to a maximum of 6 months).

Under penalty of nullity and except for fixed/definiteterm contracts shorter than 12 days, the fixed/definite term must be convened in writing in the employment contract, a copy of which must be given to the fixed/ definite-term employee by the employer within 5 days of the start of the fixed/definite-term employment relationship.

Generally, the probationary period cannot be extended so, in case of doubts on its length, it is recommended to include the maximum term permitted in relation to the employeeâ&#x20AC;&#x2122;s contractual classification.

A breach of the maximum number of extensions allowed or the maximum overall duration of the fixed/ definite-term relationship determines the automatic conversion of the fixed/definite-term employment relationship into indefinite.

Under Italian law, any non-compete/non-solicitation covenant is void if:

Fixed/definite-term employees who work for the same employer for more than six months have a priority right in indefinite new hires related to the same wok duties performed in connection with any positions that become vacant in the 12 months following the termination of the fixed/definite-term employment relationship. Fixed/definite-term employees must be informed in writing of the existence of such a priority right and must declare in writing their intention to avail themselves of this right within 6 months of the termination of the fixed/definite-term employment relationship.

Non-Compete/Non-Solicitation

a. not agreed in writing; b. no additional and separate compensation is given to the employee as consideration for the specific undertaking not to compete; and c. the covenant is not limited in business scope, geographic location and time. All 3 of the above requirements must be met to avoid the covenant being deemed null and void (i.e., unenforceable). A post-termination non-compete and non-solicitation covenant is particularly indicated for use in relation to employees with a higher contractual classification,

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such as executives (i.e., dirigenti) and middle managers (i.e., quadri) or high-ranked white-collar employees, depending on their degree of exposure to competitive information, know-how, confidential business practices, trade secrets, etc., which may make the non-compete covenant particularly advisable in the employer’s interest of restricting future employment prospects of its employees. Typically, a non-compete covenant is entered into for a period of between 6 and 18 months (the maximum term applicable to all employees other than executives is 36 months, whereas that applicable to executives is equal to 60 months, although these maximum terms are rarely resorted to).

Working Hours By law, the normal working week cannot exceed 40 hours of ordinary work, with one day of weekly rest generally falling on Sundays. The CBAs of the specific industry can provide for a shorter working week (i.e., less than 40 hours of work) and for a particular distribution of working days (from Monday to Friday/ Saturday). Both the law and the CBAs of the industry encompass specific rules and limitations concerning daily and weekly periods of rest, daytime working hours, night work, work on Sundays and public holidays, rest breaks, overtime, on-call shifts and related pay increases and/or indemnities.

At-Will Employment At-will employment is recognized in Italy under limited circumstances, namely during probationary period and upon attainment of the age provided for old-age pension (so-called "pensione di vecchiaia") by the employee. During the probationary period, both parties can terminate the employment contract without any duty of providing reasons for termination or providing notice (or paying the notice indemnity). Upon termination during probation, employees are only entitled to receive mandatory end-of-service payments (salary up until the last day of work, indemnity for accrued and untaken holidays and/or leaves, deferred compensation, additional monthly salary accruals). Upon attainment by the employee of the age required for old-age pension, instead, the employer can dismiss the employee without any particular formality (even verbally), but must respect the notice period to which the employee is entitled and in this case still pay his/ her mandatory end-of-service payments.

III. Managing Employment Relationship Performance Appraisals They are not mandatory but could be helpful to provide good evidence of an employee’s performance at any given time. In any event, in order to dismiss an employee on grounds of poor performance in Italy, negative performance appraisals are not enough alone. As a matter of fact, the employee must be placed on a written formal performance improvement plan and disciplinary actions must be started against the employee (with the infliction of the appropriate disciplinary sanction(s)) at the end of each term in which the performance improvement plan is articulated if the employee fails to meet the objectives set in the performance improvement plan. Multiple disciplinary sanctions can then constitute grounds for termination of the employee who has been put on a performance improvement plan for a reasonable timeframe (generally, 6 months at least).

Workplace Safety Rules (e.g., Posting and Consultation, Liability Insurance) Employers are obligated to provide a safe work environment and to take all actions that are necessary to protect employees’ physical and psychological integrity while at work and to prevent them from suffering damage while performing their working activities (so-called "employer’s responsibility to protect"). Employees can recover damages from the employer, unless the employer can prove that it has fulfilled its obligations under Italian legislation or that the employee’s damage is a result of the intention or the conscious recklessness of the employee. Employers are subject to an articulate set of obligations under Italian health and safety legislation, which are criminal in nature. Failure to comply with such obligations can expose the subject appointed to the office as "Employer for health and safety purposes" (i.e., generally the Company’s legal representative) to criminal sanctions (from monetary sanctions to imprisonment).

Anti-Discrimination/Harassment Legislation Italian legislation forbids direct and indirect discrimination based on, for instance, sex, age, race, ethnic origin, religious and/or personal beliefs, disabilities, sexual orientation, part-time employees, employees under a fixed-term employment contract and against foreigners. Discriminatory acts are void and, thus, ineffective under the Italian Workers’ Statute. Exceptions to the general prohibition of discrimination

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may be permitted – pursuant to the principles of proportionality and fairness and provided that the aim pursued is legitimate – when differences in treatment (related to features inherent to, for example, religious and/or personal beliefs, disabilities, age, sexual orientation, etc.) are necessary due to the nature of the working activities or to the context in which they are carried out whereby the features that are being treated in a differentiated manner constitute an essential requirement for the performance of the particular job/ working activities.

Data Privacy Obligations Italy has very stringent data privacy obligations. As a general rule, personally identifiable data can only be processed if it is both required for the performance of the employment contract/management of the related employment relationship, and if the employee has been thoroughly informed of and expressly consents to the use of his/her personal data. Failure to provide a complete informative notice to employees and to obtain their consent to the treatment of their personal data can entail the infliction of serious administrative sanctions (from EUR 6,000 up to EUR 120,000) and also of criminal sanctions (depending on the seriousness of the offense). At certain conditions, sanctions can be increased up to 4 times, depending on the economic conditions of the offending employer.

Unions Trade unions are private organizations that represent the collective interests of registered and non-registered employees of the particular industry in which their employer operates and who are signatories of the CBA(s) applied in the business. Employees may voluntarily register with trade unions and, in such case, pay a monthly contribution to the trade unions (which will typically be deducted by the employer from employees’ salaries and directly paid to the unions on behalf of employees, unless otherwise provided in the applicable CBA).

Collective bargaining agreements (“CBAs”) CBAs are typically entered into for a period of 2 or 3 years, but there is generally a continuous process of negotiation between CBA parties particularly right before or after the set expiry date (typically, expired CBAs continue to be effective up until negotiations aimed at its renewal end successfully with the conclusion of a new CBA). The most important bargaining is done at an industry and nation-wide level.

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Provisions in a CBA may not deviate from mandatory provisions of law, except in a more favorable way to employees. Specific separate CBAs apply to executive employees (i.e., "dirigenti").

Works Councils Generally, it is not mandatory for an employer to have a Works Council in place and, as such, an employer has no duty to request employees to establish them nor to inform them that they are entitled to exercise such a right upon attainment by employees of a certain threshold (in relation to which see below). However, if employees express their intention to establish a Works Council, an employer cannot prevent them from doing so and must provide employees with suitable offices, as well as allow them to take union leaves to carry out the Works Council election process. Under Italian law, two alternative forms of Works Councils currently coexist, namely RSAs (so-called “Rappresentanze Sindacali Aziendali”) and RSUs (socalled “Rappresentanze Sindacali Unitarie”). Specific rules apply to RSAs and RSUs in terms of modalities for their establishment, subjects entitled to appoint their respective members and number of members. However, both RSAs and RSUs can be established within: (i) business units with more than 15 employees; or (ii) multiple business units located in the same municipality that in the aggregate have more than 15 employees (although they do not reach such threshold if considered on a singular basis). Under Italian legislation, Works Council members are entitled to specific rights, prerogatives and protections, enabling them to carry out union-related activities and to be informed and consulted with (usually jointly with the external, local trade unions signatory of the applicable CBA(s)) under specific circumstances and in relation to certain business decisions (e.g., TUPEs, collective redundancies, organizational changes having an impact on employee working conditions, etc.).

Employee Representatives Please refer to our previous answer.

IV. Mandatory Payments/ Benefits Compensation/Benefits (Bonuses, Benefits in Kind) Employers are required to pay employees a fixed gross salary at least equal to the minimum salary set forth in the applicable CBA in relation to the employee’s contractual classification. The gross fixed salary must be composed of all salary items mandated by the applicable CBA and in the number of monthly instalments (typically 13 or more) provided by the CBA. Unless provided otherwise by the applicable CBA in relation to employees’ contractual classification and/or the specific duties assigned, no variable salary or other benefits are mandatory by law. Employees are entitled to enrolment with the specific supplementary pension and health care funds provided by the applicable CBA (to which both the employer and the employee contribute at the different salary rates at their charge).

Mandatory Vacation/Holiday By law, employees are entitled to a minimum number of vacation days per year that is equal to at least 20 working days. The holiday entitlement is generally increased by the applicable CBA(s). During holidays, employees accrue and are entitled to receive their ordinary salary. Holidays cannot be paid out, unless upon termination of employment or pending employment (but, in this case, only for the difference between the higher CBA holiday entitlement and the legal holiday entitlement).

Wages, including Mandatory Increases In exchange for the activities the employee performs for the employer, the employer must pay wages to the employee. The amount of the annual gross fixed salary is usually laid down in writing in the employment contract. The employer is obligated to pay at least the minimum wage provided by the applicable CBA in relation to the employee’s contractual classification. There is no mandatory salary increase unless such requirement follows from the individual employment contract or is mandated in the context of a CBA renewal and cannot be set off against the employee’s so-called "superminimo" (i.e., the difference, if any, between the employee’s actual salary and the minimum salary he/she is entitled to per the CBA).

Mandatory Leaves (e.g., Sick, Maternity or Parental Leave) The following overview is not exhaustive, but provides the main categories of statutory leave entitlement:

Sick leave If an employee not on probation becomes incapacitated due to a personal sickness/injury, he/she will remain entitled to retain his/her job for the term set out in the applicable CBA (which typically varies according to employee classification and seniority) and to continued payment of his/her wages for a maximum period of time which is also set out by the applicable CBA (typically, the sick leave indemnity is partly in charge of the national social security institute, so-called "INPS", and partly in charge of the employer, but, depending on the industry and on the employee’s contractual classification, can entirely be at the employer’s charge).

Maternity leave Working mothers are entitled to a mandatory maternity leave of 5 months, that are usually taken 2 months before and 3 months after the child’s birth (although a mother may decide to postpone the start of her mandatory maternity leave up to 1 month from the expected date of delivery, in order to benefit from 4 months’ leave after the birth of her child, provided that she seeks and obtains a specific authorization from a specialized doctor of the Local Health Agency (ASL)). Under specific circumstances, mandatory maternity leave can be anticipated and/or its duration extended. During mandatory maternity leave, a mother is prohibited from working and is entitled to receive her full salary based on a daily reference salary which the law defines as the average daily salary the employee was granted in the 4 weeks preceding the start of her mandatory maternity leave: generally, 80% of this reference salary is paid by the INPS and 20% by the employer. Mothers are entitled to specific rights and protections (against termination, demotion, etc.) in relation to their status and to their leave (the length of which is usually determined based on their child’s age).

Parental leave Parents may request, in writing to their employer, an optional parental leave to be used before their child’s 12th birthday. This leave can be used on a daily or an hourly basis, according to the applicable CBA. This optional leave can last a maximum of 10 months between the mother and the father’s individual respective entitlements (which can be extended to 11

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months overall under certain circumstances). The actual start and length of parental leave depends on whether it is the mother or the father (or an only surviving parent) to take the leave. For the first 6 months’ parental leave, the working mother or father (or only parent) is entitled to receive an indemnity by the INPS, which is equal to 30% of her/his salary, provided that the leave is taken prior to the child’s 6th birthday. If parental leave is taken between the child’s 6th and 8th years of age, the parent may still be entitled to receive an indemnity by the INPS if his/her annual income is below a certain threshold. In any event, the leave is unpaid if taken between the child’s 8th and 12th years of age.

Long-term care leave Generally, employees are entitled to take an unpaid leave of a maximum of 2 years over the entire term of their employment relationship to look after a family member, as defined by law, who is in need of care. This kind of leave entails a suspension of employment. As such, the employee does not accrue seniority nor other employment-related entitlements (such as holidays), except for his/her right to return to his/her job at the end of the leave. There are various forms of additional leaves like paternity leave, adoption leave and leaves of other nature provided by the law and/or the applicable CBA(s).

A. Collective Dismissals When will collective dismissals be triggered? When an undertaking that consistently employs more than 15 individuals dismisses at least 5 employees working in one or more productive units within the same province, within a period of 120 days, as a result of a "reduction or a transformation or activity or type of work"; or when an undertaking intends to cease its activity.

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Do you need to inform/consult? If so, with whom? e.g. works council, trade unions, elected reps, individual employee Yes. The employer needs to notify the competent unions, as well as the internal works councils, if any. The employer should also consult with the unions, jointly with the internal works councils, if any exist.

What do you need to inform/ consult about? Information The following information needs to be provided: · the number, positions and professional profiles of the employees to be made redundant, as well as the number of employees who are normally employed; · the time schedule for implementation of the dismissals; · the technical, organizational and production reasons justifying the dismissals and the reasons why it is not possible to adopt measures to avoid dismissals; · measures planned in order to reduce the social impact of redundancies; and · the method of calculating severance amounts in addition to any amounts provided for by the law and the collective agreements.

Consultation After the unions respond to the company's initial notice of and information on the redundancies (within seven days from receipt of said notice). The 45 day term for consultation begins to run from the day notice is given. A second round of consultation, lasting 30 days, can take place in front of the territorial Labor Office / Ministry of Welfare, if no agreement is found in the first round of consultation mentioned above.

What sanctions/penalties are there for failing to inform/consult? According to a labor reform in force as of 7 March 2015, new rules apply to employees hired after March 7, 2015: Failure to correctly apply the selection criteria or to comply with any procedural requirements will entitle the employees to a severance equal to 2 monthsâ&#x20AC;&#x2122; salary per year of service (from a minimum of 4 to a maximum of 24 monthsâ&#x20AC;&#x2122; salary). If the dismissal is communicated orally and not in writing this will result in the employee's right to reinstatement. For employees hired before 7 March 2015 the rules described below apply.

Parties to be involved in a collective dismissal Collective dismissal parties involved

Failure to apply the correct selection criteria will result in the employee's right to reinstatement.

Parties

Italy

Failure to comply with any procedural requirements will entitle the employees to a severance of 12 and 24 months' salary, depending on factors such as the total number of employees, the length of service, the parties' circumstances and behavior during consultation and the employee's efforts in finding another job.

Supervisory Board

If applicable

Works Council

Required

Are any other government or official approvals required?

Trade Unions

Required

No.

Governmental Body

DLO

Court

If applicable

Content of a social plan The nature of terminations (voluntary adherence to the redundancy procedure or unilateral dismissals) Selection criteria of redundant workers (whether mandatory legal criteria or specific criteria agreed with the Works Councils/Trade Unions) Redundancy scheme (notice period/ notice indemnity, mandatory end-ofservice allowances and additional incentives, if any, with the related calculation method) Redeployment, outplacement and career guidance

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Collective Dismissals: How should the various parties be involved a) Works Councils/Trade Unions The Works Councils/Trade Unions play an essential part in a collective redundancy procedure, which is divided into two main stages (i.e., a union consultation stage and an administrative consultation stage). An employer must notify in writing its intention to implement a collective redundancy procedure to the Works Councils, if any are established within the business unit(s) at which the redundant employees are hired, and to the local/national Trade Unions (depending on if redundant employees are located in the same or more regions), signatories of the applied national collective bargaining agreement(s) and to the local/regional/national Governmental Bodies (depending on the geographic scope of the collective redundancy procedure). Within seven days of the receipt of the notice above and at the request of the Works Councils/Trade Unions, the employer must schedule a meeting with them to discuss all aspects relevant to the collective redundancy procedure (e.g., reasons of the redundancy, alternative positioning of redundant employees within the company, the possibility of resorting to flexible-work contracts or other forms of reduction in working hours, any economic incentives available to redundant employees, etc.). The union consultation stage alone may last a maximum of 45 days, which is reduced to half (i.e., 23 days) if the employees made redundant are less than 10, and could either end successfully with the signing of an agreement with the Works Councils/Trade Unions or unsuccessfully with no agreement.

b) Governmental Bodies (Local Labor Office/Regional Agency/Ministry of Labor) Similarly to Works Councils, if established, and to Trade Unions, Governmental Bodies also play an essential role in a collective redundancy procedure. First of all, they are identified by the law among the addressees of the employer's initial notice starting the procedure. In addition, at the end of the union consultation stage, the employer must send a notice to the competent Governmental Body/ Bodies, notifying it/them of the outcome of the union consultation stage, and, if no agreement with the Works Councils/Trade Unions is reached, expressly stating the reasons why it was not possible to reach an agreement with them. In the latter case, the competent Governmental Body/Bodies may then call the employer and Works Councils/Trade Unions for a further consultation that shall take place before it/them (i.e., the administrative consultation stage). This further consultation stage may last a maximum of 30 days, which is reduced to half (i.e., 15 days) if the employees made redundant are less than 10, and could also end with the signing of an agreement with the Works Councils/Trade Unions or with no agreement.

c) Agreement with Works Councils/Trade Unions (optional) Reaching an agreement with the Works Councils/ Trade Unions is optional and does not prejudice the possibility of carrying out and concluding the collective redundancy procedure. The agreement, if any, shall describe the course of the redundancy procedure, its performance and outcome, as well as the specific arrangements, if any, taken for redundant employees. In addition, if an agreement is reached, the employer must abide by the criteria agreed with the Works Councils/Trade Unions in selecting employees to be dismissed (the agreement, if any, could either provide abstract criteria or allow the employer to select only volunteers). On the contrary, if no agreement with the Works Councils/Trade Unions is reached, the employer must abide by the criteria provided by the law (i.e., number of family dependents, seniority, technical productive and organizational needs), which operate concurrently, in selecting employees to be dismissed. In this case, the employer must compare redundant working positions within the entire business and select employees to be dismissed based on the

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criteria above - consistently with the general principle of good faith and fairness - to avoid potential claims by employees on grounds of discrimination or for breach of the same legal criteria. Once the union consultation stage and the administrative consultation stage, if any, have been carried out and irrespective of whether an agreement with the Works Councils/Trade Unions is reached, the employer is free to issue the dismissals to the redundant employees, by notifying them via a written dismissal letter (if the employees' notice periods are not observed, the employer shall also have to pay employees their notice indemnities). Within seven days from the notification of the dismissals, the employer must send a list of the dismissed employees to the competent Governmental Body/Bodies and to the Works Councils/Trade Unions, including the dismissed employees' personal information, and specifying the way in which the selection criteria were applied.

B. Individual Dismissals On what grounds can you legitimately justify the dismissal of an individual employee? There are three grounds for dismissal. • Justified objective reason (that is, redundancy for economic, production or organizational reasons); • Justified subjective reason (that is, serious misconduct in breach of the employee's contractual obligations); and

In practice, individual agreements are commonly signed as a result of a collective redundancy procedure (particularly if the employer pays out an incentive to redundant employees, in addition to mandatory end-of-service payments, and requires employees to accept their dismissal in exchange for the incentive) and are subsequently confirmed in front of the Trade Unions/competent Governmental Bodies in order to become final and irrevocable.

• Just cause (that is, circumstances, such as extremely serious misconduct or commitment of crimes, that prevent the continuation, even on a temporary basis, of the employment relationship).

d) Court

For an extremely serious breach of an employment contract, employees may be dismissed for just cause without notice.

Strictly speaking, courts are not involved in a collective redundancy procedure. However, they may get involved after completion of the procedure in the event that dismissals are issued in breach of the requirements prescribed by the law (including selection criteria, as applicable). In this case, each dismissed employee may individually challenge his/ her dismissal within 60 days from the receipt of the relevant dismissal letter. Within the following 180 days, the dismissed employee has to lodge a formal judicial claim before the competent labor court (otherwise, he/she will be time debarred from doing so). The protection against unfair dismissal that is available to employees varies depending on employee classification, date of hire and type of breach committed by the employer.

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Do you need to give notice of termination? If so, how long?

If an employee is dismissed for either a subjective or objective reason, notice must be given. The relevant notice period is set out in the applicable collective bargaining agreement, based on the employee's length of service and level.

Are employees entitled to severance compensation? If so, how much? In all cases where an employment contract is terminated, even for just cause or resignation, the employer must pay the employee the so-called "TFR". Such amount, calculated at approximately 1.5 months of salary per each year of employment, is set aside in a specific fund and paid out to the employee at the time of termination/resignation. These amounts are inflation index-linked annually.

Do you need to involve any collective or official bodies when dismissing an individual employee?

is entitled to (at the employer's choice) either be rehired or to an indemnity ranging between 2,5 and 6 months' salary. This indemnity can increase to 10 months' salary for employees with 10 years of service and 14 months' salary for employees with 20 years of service.

. In case of dismissal of an employee hired before March 7, 2015, for economic, production or organizational reasons, a pre-termination procedure in front of the local Labor Office must be preliminarily carried out. This procedure lasts up to 25 days and is aimed at finding a settlement between the parties.

What sanctions/penalties are there for getting it wrong? According to a labor reform in force as of March 7, 2015, new rules apply to employees hired after March 7, 2015: In general, unlawful dismissal entitles the employee to a severance equal to 2 monthsâ&#x20AC;&#x2122; salary per year of service (from a minimum of 4 to a maximum of 24 monthsâ&#x20AC;&#x2122; salary). In some specific cases of unlawful termination (such as for discriminatory reasons), the employee can claim reinstatement and the payment of an indemnity up to 12 months' salary. In companies with 15 employees or less, unlawful termination entitles the employee to receive an indemnity calculated at 1 months' salary per year of service, with a minimum of 2 and a maximum of 6 months' salary. For employees hired before March 7, 2015 the following rules apply: If the economical reason or the alleged behavior is "non-existentâ&#x20AC;? or groundless, or in case the misconduct is sanctioned by a less severe measure by the applicable CBA, the employee can claim reinstatement and back pay of salary from the time of termination to the time of actual reinstatement, with a maximum of 12 months salary. In all other cases where the termination is found to be without grounds the employee is entitled to an indemnity ranging between 12 and 24 months' salary. For employers with 15 employees or less, if the dismissal is found to be unlawful, the employee

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A closer look

What is a typical day at the office like for you? Max Biolchini

What is your role within Baker McKenzie?

I am a partner in the employment practice group of the Italian offices (Milan and Rome) as well as a member of the Steering Committee of the EMEA Employment Practice Group. I am also a member of the management team of the Italian offices, with responsibility over Talent Management.

Why did you choose to work at Baker McKenzie? I was originally attracted by the reputation and brand of this Law Firm and eventually discovered the most internationally diverse and dynamic working environment I had ever experienced.

I usually reach the office pretty early and take advantage of my relative solitude to sort out my diary for the day, then the rest of the morning is spent in meetings with associates and staff to review documents, provide input and sign management and administrative papers; the afternoon I try to concentrate on the "nobler" part of my job, which basically means meeting and talking with clients, studying files, writing memos etc. I usually call it a day not earlier than 8pm, then it's time for a refreshing walk back home across the Milan city centre, get ready for dinner with family and then manage last-minute e-mails from around the world before a good night's sleep.

What do you like best about your job?

The fact that no day is like any other and in this job you really do not know what you will be doing or who you will be talking to tomorrow.

What's your greatest accomplishment? Trying to put as much business sense as I can in the law that I handle for clients and at the same time learning from them how to best manage my own office

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Baker McKenzie labor & employment lawyers

wing money to Jews, his wife may have her dower and pay nothing towards the debt from it. If he leaves children that e under age, their needs may also be provided for on a scale appropriate to the size of his holding of lands. The debt to be paid out of the residue, reserving the service due to his feudal lords. Debts owed to persons other than Jews are be dealt with similarly. * (12) No 'scutage' or 'aid' may be levied in our kingdom without its general consent, unless is for the ransom of our person, to make our eldest son a knight, and (once) to marry our eldest daughter. For these rposes only a reasonable 'aid' may be levied. 'Aids' from the city of London are to be treated similarly. + (13) The city London shall enjoy all its ancient liberties and free customs, both by land and by water. We also will and grant that other cities, boroughs, towns, and ports shall enjoy all their liberties and free customs. * (14) To obtain the general nsent of the realm for the assessment of an 'aid' - except in the three cases specified above - or a 'scutage', we will use the archbishops, bishops, abbots, earls, and greater barons to be summoned individually by letter. To those who ld lands directly of us we will cause a general summons to be issued, through the sheriffs and other officials, to come gether on a fixed day (of which at least forty days notice shall be given) and at a fixed place. In all letters of summons, e cause of the summons will be stated. When a summons has been issued, the business appointed for the day shall go rward in accordance with the resolution of those present, even if not all those who were summoned have appeared. * 5) In future we will allow no one to levy an 'aid' from his free men, except to ransom his person, to make his eldest n a knight, and (once) to marry his eldest daughter. For these purposes only a reasonable 'aid' may be levied. (16) No an shall be forced to perform more service for a knight's 'fee', or other free holding of land, than is due from it. (17) rdinary lawsuits shall not follow the royal court around, but shall be held in a fixed place. (18) Inquests of novel sseisin, mort d'ancestor, and darrein presentment shall be taken only in their proper county court. We ourselves, or in r absence abroad our chief justice, will send two justices to each county four times a year, and these justices, with four ights of the county elected by the county itself, shall hold the assizes in the county court, on the day and in the place here the court meets. (19) If any assizes cannot be taken on the day of the county court, as many knights and freeholders all afterwards remain behind, of those who have attended the court, as will suffice for the administration of justice, ving regard to the volume of business to be done. (20) For a trivial offence, a free man shall be fined only in proportion the degree of his offence, and for a serious offence correspondingly, but not so heavily as to deprive him of his velihood. In the same way, a merchant shall be spared his merchandise, and a villein the implements of his husbandry, they fall upon the mercy of a royal court. None of these fines shall be imposed except by the assessment on oath of putable men of the neighbourhood. (21) Earls and barons shall be fined only by their equals, and in proportion to the avity of their offence. (22) A fine imposed upon the lay property of a clerk in holy orders shall be assessed upon the me principles, without reference to the value of his ecclesiastical benefice. (23) No town or person shall be forced to ild bridges over rivers except those with an ancient obligation to do so. (24) No sheriff, constable, coroners, or other yal officials are to hold lawsuits that should be held by the royal justices. * (25) Every county, hundred, wapentake, d tithing shall remain at its ancient rent, without increase, except the royal demesne manors. (26) If at the death of a an who holds a lay 'fee' of the Crown, a sheriff or royal official produces royal letters patent of summons for a debt e to the Crown, it shall be lawful for them to seize and list movable goods found in the lay 'fee' of the dead man to the lue of the debt, as assessed by worthy men. Nothing shall be removed until the whole debt is paid, when the residue all be given over to the executors to carry out the dead man’s will. If no debt is due to the Crown, all the movable ods shall be regarded as the property of the dead man, except the reasonable shares of his wife and children. * (27) If free man dies intestate, his movable goods are to be distributed by his next-of-kin and friends, under the supervision the Church. The rights of his debtors are to be preserved. (28) No constable or other royal official shall take corn or her movable goods from any man without immediate payment, unless the seller voluntarily offers postponement of is. (29) No constable may| Hiring compel& aFiring knight to pay2017 money for castle-guard if the knight is willing to undertake the guard 70 BMK | januari person, or with reasonable excuse to supply some other fit man to do it. A knight taken or sent on military service shall excused from castle-guard for the period of this service. (30) No sheriff, royal official, or other person shall take rses or carts for transport from any free man, without his consent. (31) Neither we nor any royal official will take ood for our castle, or for any other purpose, without the consent of the owner. (32) We will not keep the lands of people nvicted of felony in our hand for longer than a year and a day, after which they shall be returned to the lords of the es' concerned. (33) All fish-weirs shall be removed from the Thames, the Medway, and throughout the whole of

JUST ONE DAY AT THE BAKERMCKENZIE CONFERENCE 2016

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ARTICLE

Marloes Diepenbach

PhD Candidate, University of Amsterdam (UvA)

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The right to strike in the Netherlands

Marloes Diepenbach PhD Candidate, University of Amsterdam

The Netherlands does not have legislation on the right to collective action. The Netherlands ratified the European Social Charter in 1980. In 1986, the Dutch Supreme Court ruled that Article 6(4) of the European Social Charter (“ESC”), recognizing the right to collective action in cases of conflicts of interest, including the right to strike, is directly applicable in the Netherlands. This means that the lawfulness of collective action in the Netherlands should be reviewed for compatibility with Article 6(4) in conjunction with Article G of the ESC. Briefly stated, Dutch strike law is a judge-made law (rechtersrecht), founded on Article 6(4) in conjunction with Article G of the ESC.

Recent case law In two important judgments pronounced in 2014 and 2015 – Enerco and Amsta – the Dutch Supreme

BMK | Hiring & Firing | januari 2017

Court developed a new outline for collective action law in the Netherlands. With these judgments the framework for assessing the lawfulness of collective actions in the Netherlands has been changed. As a result hereof the scope for trade unions to resort to strikes or other (deviant) means of action has been enlarged. It is now, in principle, up to the trade union to choose which means of action it deploys to attain its objective. With these judgments, the Dutch Supreme Court opened the door to alternative forms of action, including relatively unusual actions, such as sit ins and sympathy strikes. The new assessment framework also provides room for more playful surprise actions like flash mobs. In other countries, e.g., the United States, flash mobs are organized regularly. It is a quite simple, rather inexpensive form of action that can potentially have (major) impact on an employer (such as negative publicity). A good example can be found at:

Biography of the Author Marloes Diepenbach graduated in Dutch, civil and criminal law, from the Leiden University at 1997. After graduating, she started working in the legal profession, spending her first year as a general practitioner at the law firm Schaap & Partners in Rotterdam. Following this, she began to specialize in employment law and from 1999 to mid-2013 worked as an employment law lawyer (with a focus on collective labor law) at Baker McKenzie in Amsterdam. She advised clients in particular on (European) employee participation law, mergers and collective bargaining law. Since September 2013, Marloes has been working on her dissertation on the right to strike in the Netherlands at the Law Faculty of the University of Amsterdam | Hugo Sinzheimer Institute.

http://youtu.be/-79pX1IOqPU “Don’t get caught in a bad hotel”

This flashmob infiltrates a hotel in the United States in an attempt to draw attention to a boycott called by the workers of the hotel. The coming years will show whether Dutch trade unions will resort to new means of action, such as flash mobs, and how the Dutch courts will deal with such novel forms of collective action.

Harmonious model of collective labor relations in the Netherlands Please note, however, that compared to other countries in Europe, the Netherlands has relatively few strike days. This is attributed to the rather harmonious model of collective labor relations, in which employers, trade unions and the government sit down to negotiate employment conditions (the Dutch consensus model known as the “poldermodel”). Conflicts are avoided as much as possible, with employers and employees/trade unions alike striving for a climate of industrial peace. This is in contrast to, for instance, several countries in Southern Europe, where labor relations are harsher. Another factor of relevance could be the industry-wide nature of many trade unions in the Netherlands, which increases the pressure from within. This is unlike the situation in France, for instance, which has a relatively large number of small unions. Self-correction is less likely in small unions.

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HIRING & FIRING LAW AND KEY EMPLOYMENT TRENDS IN THE NETHERLANDS. KEY EMPLOYMENT TRENDS BY MIRJAM DE BLÉCOURT AND REMKE SCHEEPSTRA | EMPLOYMENT LAW OVERVIEW | COLLECTIVE DISMISSALS | PARTIES TO BE INVOLVED IN A COLLECTIVE DISMISSAL | COLLECTIVE DISMISSALS: HOW SHOULD VARIOUS PARTIES BE INVOLVED? | PERSONAL INTERVIEW MIRJAM DE BLÉCOURT 76

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Hiring & Firing law and key employment trends in Europe

The

Netherlands

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Key employment law trends in the Netherlands The Dutch rules on dismissal were radically overhauled recently, with a view to making them simpler, fairer and cheaper.

Amended dismissal law

It is evident now that the law on dismissal has not become simpler. The main factors for this are the inability of employers to dismiss employees for organizational reasons in case of illness, and the possibility to appeal against court rulings twice or—in the context of proceedings via the Labor Office (UWV)—twice. This gives employees a very strong negotiating position and prompts most employers to apply the old subdistrict court formula (kantonrechtersformule) to avoid legal proceedings. Since the amended law provides, briefly summarized, that dismissals on economic grounds (including for organizational reasons) must be filed with the UWV and dismissals for poor performance must be filed with the subdistrict court—implying that employers no longer have a choice—the new rules are arguably fairer, at any rate they are clearer in the sense that the choice of procedure no longer affects employees’ entitlement to transition payment, whereas under the old regime employees were, in principle, not entitled to severance in UWV proceedings. As stated earlier, we do not believe that the new law has made things cheaper. The old regime allowed employers, with the UWV’s permission, to dismiss employees without paying severance. The employee then had to initiate manifestly unreasonable dismissal proceedings to obtain compensation. These days it is impossible for employers to dismiss staff without severance.

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Study of judgments awarding fair compensation We studied the first judgments awarding the newly defined fair compensation (billijke vergoeding) and our impression is that, so far, courts have awarded fair compensation only in exceptional cases. How the amount of compensation was effectively calculated often remained unclear. In an effort to gain an insight into the calculation methodology underlying fair compensation, our practice group analyzed all case law between July 1, 2015 and July 1, 2016, transposing the fair compensation awarded into monthly salaries per year of service. Our analysis nevertheless does not clarify to what extent courts effectively calculate fair compensation using the methodology envisaged by the legislature.

Fraud

Our practice observes a growing number of dismissals for fraud. We can play a key role, in particular in the investigation stage. Although it sounds quite straightforward—fraud automatically means instant dismissal—the reality is less clear-cut, which makes it interesting. The majority of our work still involves supervising mass lay-offs. In that context, supervisory boards are sometimes overlooked but they can be of great value by taking a more active approach.

Pensions

A trend we are seeing in the Dutch pensions sector is de-risking, which essentially means that businesses aim to ensure that the risks and costs associated with pension plans continue to be manageable and affordable. The economic tide is turning for the better in the sense that, with many pension providers in dire straits and sometimes even compelled to cut current pension payments, employees and their representatives have a major interest in an improvement of their pension plans. Many businesses respond to this trend by adjusting their pension plans, for example by transferring from a defined benefit plan to a defined contribution plan for risk management reasons so that they are no longer responsible once the contributions have been made. Other cost-cutting measures include merging pension funds or having current plans administered by new-generation pension providers such as premium pension institutions administering defined contribution plans (PPI) or general pension funds (APF), whose administration costs are well below those of current insurance products.

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WWZ poster

We have created a poster on the Dutch Work and Security Act (WWZ) to provide a comprehensive insight into the rules and processes. This “largest legal poster in history”, measuring no less than 2.3 meters by 84 centimeters, is a flow chart comprising all scenarios, process steps, accumulations, periods and references to sections of the law, and comes with a clear key to the symbols used and a list of explanatory footnotes. It is a perfect tool to keep track and make the right choices. The WWZ poster covers the termination of openended employment contracts and fixed-term employment contracts that can be terminated early. Our international WWZ poster, setting out the applicable law on individual dismissals for restructuring reasons in Germany, France, Italy, the Netherlands, the UK and the US, will be published soon. Posters are shipped in sturdy but handy cardboard tubes. The poster was co-created by Boom legal publishers, Baker McKenzie, VU University Amsterdam and Spot infographics.

Employment Law Overview I Pre Hire Considerans Pre-Hire Background/Reference Checks Permitted or Required Background checks and reference checks are permitted if the screening is necessary for the conclusion of an employment contract and/or the carrying out of the position. Only permitted with the consent of the applicant.

Pre-Hire Medical Checks/Drug Testing Permitted or Required tions Pre-hire medical checks may be carried out only if special requirements apply to the position in question with regard to medical suitability and to the extent that the medical checks take place in accordance with applicable legal requirements, including – but not limited to – data privacy requirements. Drug tests are considered a violation of the employee/candidate’s privacy, and therefore unlawful, subject to some limited exceptions.

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II. Hiring and Employment Terms Written Employment Contract/PIIA; Language Requirements Employment contracts can be written, oral, express or implied. In any event, the employer is under a statutory obligation to inform employees in writing of the terms and conditions of employment. In the Netherlands, it is very common for both parties to sign a written employment contract. Employment contracts do not have to be in Dutch to be enforceable in the Netherlands and can be in English as long as the employee understands the content of the contract and its consequences. If, however, the employee requests a translation into Dutch, the employer must provide the employee with a Dutch translation of the terms and conditions.

Definite vs. Indefinite Term/Part-Time Employees Employees can be hired on a fixed/definite-term basis for a temporary period, or for a specified project or task. If no fixed term or special task is specified in the employment contract, the contract is deemed to have been entered into for an indefinite period of time. There is no typical duration for fixed-term contracts. A fixed-term contract may be renewed by the employer; however, a fixed-term contract will automatically convert into an indefinite-term contract if certain conditions are met. If a fixed-term employment contract was agreed upon for at least 6 months, the employer will be required to notify the employee in writing at least 1 month before the fixed-term contract terminates by operation of law of specific topics that are laid down in the Dutch Civil Code. If the employer does not comply with this notification obligation, the employer will be required to pay compensation equal to the employee’s salary for the days that the employer is late with this notification (up to a maximum of 1 month’s salary).

Probationary Periods A probationary period is possible for employment contracts that are entered into for an indefinite period of time and for a fixed term that exceed 6 months in writing. The duration depends on the duration of the contract.

Non-Compete/Non-Solicitation A post-termination non-competition restraint is enforceable if it is concluded in an indefinite-term contract, signed by both parties and reasonable in geographic and functional scope and it is for a fixed period of time (typically for a period of between 6 months to 1 year). Only under special circumstances is a non-competition clause valid in a definite-term contract.

Working Hours The normal working week is between 36 to 40 hours, depending on the industry, and 5 days per week, excluding Saturdays and Sundays. Both Dutch law and any applicable CBA contain standards for periods of rest, working hours, night work, work on Sundays, rest breaks, overtime, and oncall shifts.

At-Will Employment

Employers are obligated to provide a safe work environment and prevent employees from suffering damage while performing their working activities. Employees can recover damages from the employer, unless the employer can prove that it has fulfilled its obligations under Dutch legislation or that the employee’s damage is a result of the intention or the conscious recklessness of the employee.

Anti-Discrimination/Harassment Legislation The Dutch Civil Code forbids direct and indirect discrimination based on, for instance, sex, age, disabled and chronically ill people, part-time employees, employees under a fixed-term employment contract and against foreigners. In general, direct discrimination is only permitted if an objective ground is explicitly mentioned in the discrimination act concerned. Indirect (and in case of discrimination based on age also direct) discrimination can be justified by an objective justification if this objective justification fulfills the requirements of legitimacy, proportionally and efficiency.

At-will employment is not recognized in the Netherlands. As such, unilateral changes to terms and conditions of employment are not permitted, and require express, voluntary employee consent, unless the parties agreed upon a unilateral amendment clause (“eenzijdig wijzigingsbeding”) pursuant to which the employer has reserved the right to amend the employment conditions without the prior consent of the individual employee. An employer can only invoke a unilateral amendment clause if the employer has such a substantial interest in the amendment that this interest outweighs the interest of the employee. As is evident from legislative history, a substantial interest above is not readily accepted. A substantial interest will be accepted in case of compelling commercial or organizational circumstances, such as necessary reorganization or financial inability of the company.

Data Privacy Obligations

III. Managing Employment Relationship

CBAs are typically entered into for a period of 1 or 2 years, but there is generally a continuous process of negotiation between CBA parties. The most important bargaining is done at an industry-wide level. Provisions in a CBA may not deviate from obligatory law (e.g., the acts on minimum wage, equal treatment, etc.), but provisions in a CBA may deviate from what is known as the “three-quarter obligatory law”.

Performance Appraisals There are not obligatory. But they are advisable as they provide good evidence of an employee’s performance at any given time. Please note that this will be the only basis for proof of non-performance.

Workplace Safety Rules (e.g., Posting and Consultation, Liability Insurance)

The Netherlands has very stringent data privacy obligations. As a general rule, personally identifiable data can only be processed if it is either required for the performance of the employment contract, or if the employee has expressly consented to the use of his/ her personal data.

Unions Trade unions are organizations that represent the individual and collective interests of registered employees and members. Members may voluntarily register with trade unions.

Collective bargaining agreements (“CBAs”)

Works Councils Under Dutch law, every employer that generally employs at least 50 employees is obligated to have its own works council, consisting of employee members who are chosen by the employees. Works

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Councils have specific consultation and consent rights regarding, for instance, intended reorganizations or intended changes of bonus plans.

Employee Representatives Personnel Committee A company in the Netherlands with at least 10 but fewer than 50 employees that has not established a works council can establish a personnel committee/ staff representation. The company is only required to do so, however, if more than 50% of the workforce request it. Once established, the personnel committee/staff representation is entitled to render its advice regarding an intended decision of the company that may result in a loss of jobs or in major changes in the work, the terms and conditions of employment or the working conditions, provided that at least 25% of the employees working for the company will be impacted. Staff Meeting Where there is no works council or personnel committee/staff representation (and the company has between 10 to 50 employees), the employees are entitled to give their advice at an all-employee (staff) meeting regarding any proposed business decisions that may result in a loss of jobs or in major changes in the work or terms and conditions of employment, provided that at least 25% of the workforce would be impacted by the proposed decision.

IV. Mandatory Payments/ Benefits Compensation/Benefits (Bonuses, Benefits in Kind) Employers are required to pay employees a holiday allowance of at least 8% of the employees’ annual gross salary, which must be paid no later than the month of June each year. The employer and employee can also agree that the holiday allowance will be paid monthly on a pro rata basis. If the employee earns more than 3 times the minimum wage, however, the employer is no longer obligated to pay the holiday allowance over the amount which exceeds the “three times the minimum wage” threshold. This arrangement is uncommon in the Netherlands. The employer and the employee can in that event reach an agreement in writing that the monthly gross salary payment will include 8% holiday allowance.

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Mandatory Vacation/Holiday Employees are entitled to a minimum number of vacation days per year that is equal to at least 4 times the number of working hours in a week (i.e., at least 160 hours (20 days) in the event of employment 40hour workweek). As a matter of practice, employees are typically provided with at least 24 or 25 vacation days per year.

Wages, including Mandatory Increases In exchange for the activities the employee performs for the employer, the employer must pay wages to the employee. The amount of wages and the period of wage payment must be laid down in writing, usually in the employment contract. The employer is obligated to pay at least the minimum wage to its employees. The minimum wage varies according to the employee’s age. From January 1, 2016, the minimum wage for an employee 23 years old or older, on the basis of full-time employment, is EUR 1,524.60 gross per month. Statutory minimum wages are indexed twice per year, on January 1 and July 1. There is no mandatory salary increase unless such requirement follows from the individual employment contract or CBA.

Mandatory Leaves (e.g., Sick, Maternity or Parental Leave) The following overview is not exhaustive, but provides the main categories of statutory leave entitlement:

Sick leave If an employee becomes incapacitated, he/she will remain entitled to continued payment of wages for a maximum period of 104 weeks (i.e., 2 years). Long-term care leave is unpaid. However, accrual of statutory vacation days will continue. There are various forms of leaves like parental leave, adoption leave, care leave.

A. Collective Dismissal

• the proposed timescale for such redundancies; • the severance package, including calculation of severance payments and outplacement plan; and • the proposed termination route.

When will collective dismissals be triggered?

Consultation

Do you need to inform/consult? If so, with whom? e.g. works council, trade unions, elected reps, individual employee

In practice the employer will normally offer a “social plan” to the unions and works council with its proposed method of termination, compensation, moving expenses, assistance in finding other employment, continued health insurance, expenses etc.

When in any 3 months period a company intends to make at least 20 employees redundant within one working area (or labor authority area, i.e. “UVW” area)

Yes. A request for advice to the works council will need to be prepared, and notification given to the unions. If the unions respond, consultation should then take place. If the unions do not respond for any reason within a reasonable period of time, or if they respond that they are not interested, then there is no need to consult with them.

What do you need to inform/ consult about? Information The request for advice to the works council must include a summary of the reasons for the company’s proposed redundancies, the expected consequences, and the measures the company proposes for the redundancies.

Matters to be consulted are the need for the intended collective dismissal, the implementation of the dismissal and the possible measures to reduce the impact on employees.

What sanctions/penalties are there for failing to inform/consult? Moreover the companies chamber can prevent the decision of the collective dismissal to be implemented or to have the decision withdrawn. The employee may request that the termination be declared void, request that his/her employment contract will be reinstated or request reasonable compensation. Such compensation will only be granted in exceptional circumstances.

Are any other government or official approvals required? No.

The unions/works council/personnel representatives and UWV must be provided with: • the reasons/grounds for the collective redundancies plus substantiation with objective facts and figures; • the number of employees to be made redundant along with a breakdown of their position, age and sex; • the selection of the employees to be made redundant; • the number of employees normally employed;

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Parties to be involved in a collective dismissal Collective dismissal parties involved Parties

Netherlands

Supervisory Board

If applicable

Works Council

Required

Trade Unions

Required

Governmental Body

UWV

Court

If applicable

Content of a social plan The nature of the dismissals (compulsory or not) Selection criteria of redundant workers Redundancy scheme (notice period and allowances) Redeployment, outplacement and career guidance Rules concerning aboard of appeal

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Collective Dismissals: How should the various parties be involved a) Supervisory Board If the company has a Supervisory Board, it needs to be involved in the intended decision on a collective dismissal. The Supervisory Board can either be asked to decide on the collective dismissal or on submitting the request for advice to the Works Council.

b) Works Council The Works Council needs to be asked advice in writing on the intended collective dismissal at a stage where the advice of the Works Council is still relevant and the actual decision can still be influenced. The Works Council should at least be given one consultative meeting to render its advice. According to case law, the Works Council should be granted at least six weeks to come up with advice. If the Works Councilâ&#x20AC;&#x2122;s advice is negative, a one-month waiting period needs to be taken into account during which no implementation can start and the Works Council can start court proceedings in court (ondernemingskamer).

c) Trade Unions The Trade Unions play an essential part in a collective redundancy. The Trade Unions should be officially notified regarding the intended dismissal. The Trade Unions are entitled to give their view on the necessity of the collective dismissal and are entitled to discuss whether there are alternatives that are less far reaching. Once they are convinced a collective dismissal is not to be avoided or decreased in numbers, negotiations on severance packages in the broadest sense will start. The outcome will be laid down in a social plan.

d) Social Plan The Trade Unions will be involved in negotiations concerning this social plan, which serves as a

safety net. The plan describes the course of the reorganization as well as the arrangements made for dismissed employees.

e) Governmental Body (Labor Office, UWV) In addition to the Supervisory Board, the Works Council and the Trade Unions, the Labor Office (“UWV”) is closely involved with the collective redundancies. Similarly to Trade Unions, the employer needs to formally notify the UWV about the considerations regarding the intended redundancies. The UWV is also involved in granting permits to give notice. If no permit is obtained, the company can simply not give notice, and therefore not come to a termination of the employment agreement, provided that it is an agreement for an indefinite period of time and no amicable settlement can be reached. A permit is only obtained if the grounds for the dismissal are valid and the selection criteria have been adhered to.

f) Court The decision of the UWV can be appealed with the court, the court of appeal and the Supreme Court.

B. Individual Dismissals

On what grounds can you legitimately justify the dismissal of an individual employee? A reasonable ground for dismissal is: a. business economic reasons; b. long term illness; c. regular illness; d. non-performance; e. culpable behavior or omissions; f. conscientious objection; g. disturb working relationship; h. other circumstances (this is not a residual category, it is a very limited ground).

The grounds determine which route for dismissal applies. Permission of the UWV is required in case of grounds a and b, whilst court dissolution is required in case of termination due to grounds c up to and including h.

Do you need to give notice of termination? If so, how long? Notice periods are statutory. The following notice periods are to be observed: • an employment contract which has lasted for a period less than 5 years: 1 month; • an employment contract which has lasted for a period between 5 and 10 years: 2 months; • an employment contract which has lasted for a period between 10 and 15 years: 3 months; and • an employment contract which has lasted for 15 years or longer: 4 months.

Are employees entitled to severance compensation? If so, how much? Since July 1, 2015 the Cantonal Court Formula has been abolished and replaced by a statutory severance payment, the transition payment. In case of a dismissal due to reorganization the employer will in principle be obliged to pay the employee a transition payment, if the employment has lasted for two years or longer. The payment is not age-related and amounts to 1/6 of a monthly salary for each half year of service over the first ten years of the employment agreement. Over each period of six months thereafter, the transition payment amounts to 1/4 of a monthly salary. For employees above the age of 50 a higher calculation standard applies until the year 2020, save in the event of a small employer (with 25 employees or less) where the dismissal was prompted by the bad financial situation of this small employer. The definition of a ‘monthly salary’ is the same as the definition of the B factor under the old Cantonal Court Formula (i.e. one gross monthly salary plus all fixed wage components). The payment is set at a maximum of EUR 76,000 gross or one annual salary for employees, if that is more. Please note that no transition payment will be due if the employment contract has been terminated by mutual consent. However, in order to come to a

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mutual agreement with the employee some form of compensation will be required. Practice since July 1, 2015 shows that the severances paid in these cases are above the transition payment (sometimes based on the Cantonal Court Formula), however, the transition payment (and not the Cantonal Court Formula) will serve as the starting point of the negotiations.

Do you need to involve any collective or official bodies when dismissing an individual employee? If the employment contract will not be terminated by mutual consent, then the grounds for dismissal will determine which route for dismissal applies (i.e. the UWV or the court).

What sanctions/penalties are there for getting it wrong? If a termination is deemed unfair or illegal, the labor court may, at the employeeâ&#x20AC;&#x2122;s request, decide that: the notice is ineffective the employee be re-employed in the event that an employment agreement was terminated (as was concluded for an indefinite period of time); or or the employee be paid compensation. Any compensation payable may be equal to the salary for the period of two weeks to three months, but not less than the salary due for the notice period.

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A closer look

I have two sons who both study in Leiden and who are enthusiastic kite surfers. They choose to study Chinese and Law and Earth and Economy.

Why did you choose to work at Baker Mirjam de BlĂŠcourt McKenzie? What is your role within Baker McKenzie?

Heading the employment practice in Amsterdam and leading 15 employment practitioners together with my colleague Remke Scheepstra is the main role I fulfill within Baker McKenzie. I have always enjoyed to inspire others and that is exactly what I try to do every day. As a team we ensure that we give thorough advice that helps our clients run their business in the best way possible. We have many longstanding clients that have become close to our hearts over the years. I have been a board member of Baker McKenzie Amsterdam for seven years which enables me to understand that clients have to make business decisions all the time and with that availability of us lawyers is key to be a real business partner for them. Being a member of the EMEA Employment Steering Committee is a role I fulfill happily as we constantly think of new and creative ways to explain the law. An example is the poster we made to explain the new Dutch dismissal laws. I am also a member of the Diversity and Inclusion Committee of Baker McKenzie worldwide and I have served in the Global ethical committee for many years. As a personal note my husband and

As I studied both civil and tax law I choose an international law firm where both disciplines already worked in an integrated manner. The practice group way of working was the way I envisaged to work as I thought you can learn from other countries it widens your scope. It also gave me the opportunity to work briefly in London and New York on client assignments. The people I met during my job interviews were very diverse which I like most in my job.

What is a typical day at the office like for you?

Every day is different, that -amongst many other things- makes being a lawyer so interesting. One day you discuss with your employment team the trends in the law, the other day you sit with trade unions to try to avoid a strike at a client. But also my board positions make day to day life worthwhile and give me different perspectives on what companies want and what is important to them. Another day I might speech at a charity that is close to my heart diabetis type I or Female Cancer Foundation. The latter is so interesting as it can find ovarium cancer with a simple vinegar substract that is very inexpensive. In order for the Foundation to be able to treat

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the woman, it starts with negotiations with the village head to give his consent.

What do you like best about your job?

To be able to help boards strategically and make complicated laws sound easy. To find the best outcome for all parties involved. But also to help young lawyers accelerate.

What's your greatest accomplishment? I really enjoyed the Cruyff case (Cruyff was a famous football player) because the person was special and because we worked in a team of lawyers from various disciplines and really felt that justice was done by the court. Also the enormous media attention was something we had to take into account and work with. Every collective dismissal I advice on and bring to an end that every one in the end feels good about is what makes me happy. Apart from that raising two wonderful boys that care about society is what makes me proud.

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Europe Women in Business Law Awards 2016

Mirjam de BlĂŠcourt

Elected Best in labour & employment Mirjam also won this award in 2011 and 2012.

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THE INTERVIEWEES OF BAKER MCKENZIE IN THIS MAGAZINE

Guenther Heckelmann Guenther.Heckelmann@bakermckenzie.com +49 69 2 99 08 142

Bernhard Trappehl Bernhard.Trappehl@bakermckenzie.com +49 89 5 52 38 115

Max Biolchini Massimiliano.Biolchini@bakermckenzie.com +39 02 76231 321

Mirjam de Blécourt Mirjam.deBlecourt@bakermckenzie.com +31 20 5517 466

Fermin Guardiola Fermin.Guardiola@bakermckenzie.com +34 9 123 04 611

Piotr Rawski Piotr.Rawski@bakermckenzie.com +48 22 445 3133

Christine O’Brien Christine.O’Brien@bakermckenzie.com +44 207 919 1189

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INTERVIEW by Mirjam de BlĂŠcourt

Hendrikje Crebolder

Head of the Development Department, Rijksmuseum

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Hendrikje Crebolder

Head of the Development Department, Rijksmuseum

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What is your current job position? I am the Head of the Development Department of the Rijksmuseum. In this capacity, I am â&#x20AC;&#x2019; with 15 team members â&#x20AC;&#x2019; responsible for generating support from private benefactors, foundations, corporations, and Museum Friends.

What are you proud of? I personally set up the Development Department of the Rijksmuseum in 2009. Over the past number of years, we have successfully formed structural partnerships with a diverse range of national and international corporations including Philips, ING, KPN, Heineken, KLM and Ahold and Baker McKenzie.

That is an impressive group of large Dutch corporates. Why also work with a US law firm? Actually, Baker McKenzie Amsterdam has sponsored the Rijksmuseum's 20th century photography collection for over a decade. They stood by us even during the period of almost 10 years in which the museum was closed to the public. Thanks to the support of Baker McKenzie, we have built a substantial modern photography collection, which was showcased only last year during the exhibition and impressive catalogue “Modern Times”. Aside from these contributions, I believe that the two companies form a great match. Much like the Rijksmuseum, Baker McKenzie is known for being ahead of the curve with an international reach and reputation of excellence.

Naturally, you also have a personal connection with Baker McKenzie… Indeed! Before working for the Rijksmuseum, I was a lawyer in the Employment practice of Baker McKenzie Amsterdam for nine years.

That seems to be a completely different career path? In many ways it is, but in some ways it isn't. Working on revamping the whole museum, including its fundraising activities, is obviously a completely different ball game than being an employment lawyer. However, during my time at Baker, I worked at a number of different offices, including Amsterdam, Kazakhstan, Paris and Madrid, and I have successfully managed to translate this international experience to the work that I do now. I am grateful for both experiences and the combination of he two has proven to be ideal for me. Mirjam: That’s nice to hear. I remember you being a diligent, thoughtful and good employment lawyer who could easily have become a partner in our firm. On top of that, you are very creative and fun to work with. But above all, you are a good friend.

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HIRING & FIRING LAW AND KEY EMPLOYMENT TRENDS IN SPAIN. KEY EMPLOYMENT TRENDS BY FERMÍN GUARDIOLA | EMPLOYMENT LAW OVERVIEW | COLLECTIVE DISMISSALS | PARTIES TO BE INVOLVED IN A COLLECTIVE DISMISSAL | COLLECTIVE DISMISSALS: HOW SHOULD VARIOUS PARTIES BE INVOLVED? | PERSONAL INTERVIEW FERMÍN GUARDIOLA

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Hiring & Firing law and key employment trends in Europe

Spain

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Key employment law trends in Spain Employment law background in Spain: from pro-employee to pro-employer Traditionally, Spain was considered a pro-employee jurisdiction, although since 2010 the government has passed a number of amendments to Spanish employment and labor laws that have substantially favored employers. The most significant set of amendments in 2012 substantially lowered severance costs, increased the employer's rights to modify existing employment conditions (including previously agreed salary, job duties and job location) and curtailed the power of unions in negotiating collective bargaining agreements. Cheaper salaries and an available workforce, coupled with generally favorable legal trends, have made Spain a much more proemployer jurisdiction over the last few years. In this respect, for example: - Severance compensation costs reduced to 33 days' salary per year worked for contracts entered into after 11 February 2012 (in line with OECD countries). - Redundancies have since 2012 been significantly facilitated: even in profit making companies since what constitutes sufficient financial cause for redundancies has been significantly broadened (e.g. when the company’s ordinary income in three consecutive quarters is less than the ordinary income in the same period of the previous year), increasing the chance of fair redundancy and reduced severance costs (limiting their costs to the 20 days salary per year worked)- However, the latest Court decisions have very much emphasized the need for employers to guarantee the proportionality between the business grounds justifying the employment terminations and the number of employees actually made redundant. - More flexible procedure for collective dismissal: even though the procedure for collective dismissal now

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appears more flexible (e.g. it is no longer subject to prior approval by the Labour Authorities), court cases have made the procedure now highly “formal”, with strict documentary requirements for downsizing and the slightest formal mistake could render the whole process null and void. Courts are also applying very strict standards to verify that companies consult with the works council with the utmost good faith; so, for example, not budging, or not changing one’s stance, in negotiations could result in an invalid consultation for lack of good faith in negotiations. In fact, labour courts are being very restrictive in their interpretation and declaring many collective dismissals null and void, with the effect of companies having to immediately reinstate employees with backpay.

Current Uncertain political scenario: potentially significant employment reforms General elections have recently been held twice in Spain (December 2015 and June 2016). The conservative party, which is currently in power, won the elections twice, but does not hold the majority of the parliamentary seats; consequently, the only way it will be able to continue in power is if it succeeds in getting sufficient support from other political parties. To date, it has failed to obtain the support it requires, and so there seem to be two main possibilities regarding the future government in Spain. One possibility is that the socialist party PSOE end up in power if it succeeds in obtaining the support of other parties substantially further on the left. The other possibility (if the PSOE fails in getting that support), is that a third election be called for December 2016. In either case, amendments to the labor and employment laws are expected-- if the left ends up governing, the amendments are expected to revoke the conservative government’s 2012 amendments, while if the conservative party currently in power ends up governing, further pro-company amendments would be expected in 2017.

Spain’s National Court Holds that Companies Should Record Employees’ Worktime on Daily Basis Two recently published National Court decisions have

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held that employers should record the time worked by their employees on a daily basis, regardless of whether the employees work overtime or not. The Spanish Labor Act requires companies to keep a record of employee’s workday “for purposes of calculating overtime,” and, traditionally, this requirements has been interpreted to mean that employers had to record worktime only when overtime was performed. The National Court, however, in these cases now argues that the obligation to record worktime exists precisely to determine whether overtime has been performed or not, and so companies are obliged the record all worktime on a daily basis. Further, the Court underscores that it makes no difference whether the company applies a flexible work time system or whether the employee works outside of the company’s premises. The court decisions nonetheless do not specify how work time needs to be registered, so substantially uncertainly currently exists regarding the method and means that should be used. The two court decisions do not technically constitute case law until the Supreme Court confirms them, but the Spanish employment authorities are beginning to apply them and asking companies inspected to show worktime registrations.

Social security tax inspections In an effort to obtain more funds for the Spanish Social Security System, in late 2015, the government employment department began a campaign to review how much companies were paying for social security tax for workplace accidents and illnesses. Since the tax varies significantly (in some cases by up to six percent or more of the taxable social security basis) depending on the job positions employees hold, government officials have been inspecting companies and evaluating employees’ job classifications for the purposes of the social security tax. In some cases, officials have re-characterized office employees (who are subject to a relatively low tax for workplace accidents and illnesses) as employees of the company’s main activity (such as, pharmaceutical or manufacturing employees, with a much higher applicable tax rate). For some large companies, these massive re-classifications of personnel have resulted in liability for allegedly overdue social security taxes and fines reaching hundreds of thousands of euro. Indeed, for some companies, the liability has exceeded EUR one million. Companies should review their classification system and take possible pre-emptive measures against such inspections.

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Compensation during the vacation period On 8 June 2016, the Spanish Supreme Court laid down two significant judgments which establish what compensation must be paid during the vacation period, in accordance with previous ECJ judgments. These resolutions are important because they correct the prior doctrine of the Supreme Court, which previously allowed collective bargaining agreements to specify what the compensation would be for the vacation period and to even leave out certain salary components when calculating such compensation, provided that the legal minimums were respected. The Supreme Court decided that vacation pay: • Must include sales rep allowances and oncall allowances, because they are fixed salary components that are paid monthly (Supreme Court Judgment 8-6-2016, Resolution 207/2015), as well as any sales commission and production incentives, because such concepts are not linked to working longer periods of time (such as longer workdays or overtime) and their inclusion in vacation pay does not imply a repetition or duplicity thereof. • Must exclude bonuses, as they are a component of annual and extraordinary accrual, and dependent on the employee's potential results, as well as on the company's hypothetical general objectives . (Supreme Court Judgment 8-6-2016, Resolution 207/2015).

Thresholds to trigger collective dismissal procedure The ECJ issued two major rulings that established that two aspects of Spanish law that govern collective dismissals infringes the Directive. In one case, judgment of May, 13 2015 (the Rabal Cañas case), the ECJ held that the unit that should be taken into consideration in computing the existing number of employees and the number of employees to be laid off for purposes of the thresholds is the work center, and not, as Spanish law established, the company. There has already been at least one case in Spain where an appellate court has held redundancies null and void for failing to follow the collective dismissal procedure in contravention of the Rabal Cañas decision, despite the fact that under the Spanish Labor Act, the collective dismissal procedure was not required. In the second case, judgment of STJUE de November 11, 2015 (the Pujante Rivera case),

the court held that for purposes of the thresholds regarding the number of employees to be laid off, the law should consider any other terminations not due to the employee, whereas Spanish law requires that these other types of terminations must amount to at least five in order to compute for the purposes of the collective dismissal thresholds. Employers should take care when calculating the number of employees to be laid off in order to determine whether the collective dismissal procedure is triggered.

Employment Law Overview

Employment contracts can be written, oral, express or implied, but Spanish law establishes that some types of contracts must be in writing. The government has established model form contracts that should be used, although additional clauses may, of course, be added. In any case, the employee can request his/her employer to provide a written contract at any time during the employment relationship. However, if an employee is hired for more than 4 weeks, the company must inform, in writing, about the basic conditions of the contract. Companies are obliged to inform of all employment contracts to the National Public Employment Service.

I Pre Hire Considerans

Employment contracts do not have to be in Spanish to be enforceable and can be in any other language as long as the parties understand the content. However, it is customary to draft employment contracts in Spanish for evidentiary purposes.

Pre-Hire Background/Reference Checks Permitted or Required

Definite vs. Indefinite Term/Part-Time Employees

Background and reference checks are generally not required by law and are relatively uncommon in Spain. Employers may only conduct such checks regarding certain "sensitive" information (e.g., educational history) with the applicant’s express consent and only to the extent such information is directly related to the job position at issue.

Employment contracts are presumed to be for an indefinite period of time, but can be for a fixed/ definite period of time in the cases established by law (i.e., for a specific project or task, due to increase in workload, etc.).

Pre-Hire Medical Checks/Drug Testing Permitted or Required tions Pre-hire medical exams are not required, but can be carried out with the job applicant’s express consent. Notwithstanding the foregoing, pre-hire medical checks can be required in certain cases due to the specific nature and safety requirements of a given position. Drug testing could likely be considered a violation of a job applicant’s privacy and is, in any case, somewhat unusual in Spain. Nonetheless, if the specific job position sufficiently justifies the company’s interest in the test, the company may ask for the applicant’s consent to such testing as part of the recruitment process before hiring the applicant.

In Spain, there are temporary limits for each type of fixed-term contract. If the employment relationship continues after the expiration of a fixed-term contract, the contract will be automatically turned into an indefinite-term contract. Likewise, if the fixed-term contract is entered into fraudulently, the contract will as well be deemed indefinite. Certain types of fixed-term contracts require a severance compensation upon termination. Part-time contracts can be either for an indefinite term or for a fixed term, provided that the type of contract may be entered into for a fixed term. Work-study contracts may not be entered into on a part-time basis.

Probationary Periods

II. Hiring and Employment Terms

A probationary period is possible if (i) agreed in writing and (ii) does not exceed certain time limits depending on the professional category of the employee (i.e., 6 months for qualified employees).

Written Employment Contract/PIIA; Language Requirements

In fixed-term contracts lasting under 6 months, the probationary period shall not exceed 1 month.

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Lastly, as of February 12, 2012, companies with fewer than 50 employees may hire employees under a specific entrepreneur contract, subject to a 1-year probationary period. so long as certain circumstances are met.

Non-Compete/Non-Solicitation To be valid, a non-competition clause after termination must meet the following requirements: (i) agreed in writing; (ii) cannot exceed certain time limits depending on the professional category of the employee (2 years for qualified employees); (iii) the employer has a genuine proprietary, industrial or commercial interest that requires protection; and (iv) the employer must pay the employee appropriate compensation. Some types of non-solicitation clauses (e.g., non solicitation of clients) are sometimes viewed as a form of non-competition restriction, and consequently are subject to the above rules.

Working Hours The maximum permitted working week is 40 hours on an annual average, although the CBA may establish a lower limit. According to case law, the annual maximum working time based on 40 hours per week is 1,826 hours and 27 minutes. Most CBAs have decreased the maximum number of hours permitted and often set the maximum at 1,780 hours. Any time worked in excess of the ordinary work hours is considered overtime. Both Spanish law and any applicable CBA contain standards for periods of rest, working hours, night work, work on Sundays, rest breaks, overtime, and oncall shifts.

At-Will Employment At-will employment is not recognized in Spain. Minor changes to employment conditions can be made unilaterally by the employer without following any specific procedure. Substantial changes to employment terms and conditions that do not affect over a certain number of employees can as a general rule be made with employee consent or, alternatively, unilaterally by the employer so long as economic, organizational,

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productive or technical reasons for the change exist and 15 days’ written notice is provided to the employee and employee representatives. If the number of employees affected by the substantial changes equals or exceeds certain thresholds in any 90-day period (or in certain cases consecutive 90day periods), then the changes would be considered collective and require consultation with employee representatives.

III. Managing Employment Relationship Performance Appraisals Although performance appraisals are not required, they are advisable as they provide good evidence of an employee’s performance at any given time. There is no specific procedure for conducting performance appraisals, unless one is established in the contract of employment, by another form of agreement with the employee, or by company policy. Care should be taken when establishing performance appraisal procedures to avoid creating procedural rights for the employee in the event a summary dismissal is subsequently required.

Workplace Safety Rules (e.g., Posting and Consultation, Liability Insurance) In Spain, companies must comply with the Health and Safety Act. This piece of legislation sets out employers’ obligations to ensure a safe working environment without risks to employees’ health. Employers’ obligations include but are not limited to activities such as: (i) Elaboration of a Prevention Plan; (ii) Risk Assessment; and (iii) Information & Training of employees. The Act also sets specific obligations for employers to monitor employees’ overall health and exposures to occupational hazards inherent to their work. The monitoring is accomplished by ensuring that employees receive annual health check-ups.

Anti-Discrimination/Harassment Legislation Spanish Labor Law prohibits discrimination and harassment in the workplace based on, for instance, age, disability, sex (including pregnancy, maternity, or paternity), origin (including racial or ethnic origin), marital status, social status, religion or convictions, political beliefs, sexual orientation, trade union membership (or lack thereof), family relations with

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other employees within the company and language within the Spanish territory. Any discriminatory decision made with regard to dismissal, pay, hours, and other work conditions may be null and void. Discriminatory labor practices can result in damages and/or reinstatement with back pay; and subsequent disciplinary measures are likely to be considered retaliatory. Spanish law also has provisions dealing with sexual harassment in the workplace. Sexual harassment may be grounds for a disciplinary dismissal.

Data Privacy Obligations Spain has very stringent data privacy obligations. As a general rule, personally identifiable data can only be processed if it is either required for the performance of the employment contract, or if the employee has expressly consented to the use of his/her personal data.

Unions Union rights are constitutionally recognized, and depending on the number of employee representatives who are elected at companies throughout Spain and who are members of a particular union, the unions are granted proportional rights to negotiate national and/or regional CBAs that apply to different industries. Unions with representation within companies are also entitled to information and normally participate in consultations and negotiations in support of the employee representatives.

Collective bargaining agreements (“CBAs”) CBAs are detailed, binding agreements negotiated between unions (and/or other employee representatives) and employers associations (and/or employers). Many CBAs have been negotiated for a specific industry and apply throughout the entire country, to the extent that all companies in Spain that belong to that specific industry will automatically be bound by the rules established in the nationwide CBA. Other agreements apply only to a specific province or limited geographical area, or, if the agreement is negotiated at a company level, to a specific company (or part of it), as may be agreed by the negotiating parties. In short, CBAs apply by industry and location automatically, whether or not the company has participated in negotiating the CBA. Virtually all companies in Spain are subject to some CBA.

Works Councils Under Spanish law, companies with more than 50 employees may establish a works council if the employees decide to call elections (not mandatory), consisting of employee members who are chosen by the employees. Works Councils have information and consultation rights as established by law (access to company information, e.g., sales, production, financial statements, etc.) and are permitted to offer their opinion on certain situations affecting employment, such as collective reorganizations, on-the-job training, relocation, and corporate reorganization. Employee representatives are entitled to prior consultation in certain cases, including: (i) transfers of undertakings that entail labor measures; (ii) substantial modification of collective employment conditions including significant collective relocations; and (iii) collective dismissals.

Employee Representatives Personnel delegates For employers with 11 to 49 employees, employees may choose to elect personnel delegates to represent the interests of the employees. For employers with 6 to 10 employees, a majority of employees may choose to elect one personnel delegate. Note that regardless of the number of employees, if the employees do not initiate elections, employers do not have the obligation to promote elections. Employee representatives enjoy special rights regarding sanctions and dismissals, and are permitted a certain number of hours each month to perform their duties as employee/labor representatives. Note that employee representatives do not need to belong to a union, though oftentimes they do.

IV. Mandatory Payments/ Benefits Compensation/Benefits (Bonuses, Benefits in Kind) Many employees are paid a bonus or commission (or both) as part of their remuneration. Bonuses and commissions may not be left to the entire discretion of the employer and so it is advisable to clearly establish the conditions that may entitle the employee to a bonus (or commission) and that will determine the

amount of any bonus (or commission). Even if bonuses and commissions are granted unilaterally and for a limited period of time, they can become acquired rights, so care should be taken in implementing any such schemes. Bonuses and commissions form part of remuneration and are therefore subject to tax and national insurance in the normal way. They will also be taken into consideration in the calculation of any severance pay that may be required. Many employees, particularly senior level employees, obtain benefits in kind such as company cars, medical and disability insurance, life insurance and occupational pensions. Such benefits, however, are not mandatory, unless otherwise agreed to or established under the applicable CBA. Finally, note that CBAs normally establish some benefits, such as transportation allowances, minor insurance coverage, etc.

Mandatory Vacation/Holiday Employees are entitled to no less than 30 calendar days of vacation per year which is considered the equivalent of 22 workdays. The applicable CBA may increase the vacation entitlement and often establishes rules on when vacation must be taken. Employees are also entitled to 14 paid public holidays per year. The dates of these public holidays are established by the government and may change from year to year. The applicable CBA may establish additional holidays.

Wages, including Mandatory Increases CBAs establish the minimum wage to be paid to each category of employees. In absence of regulation, the minimum wage established by the government on a yearly basis applies. In 2016, the statutory legal minimum wage amounts to EUR 655.20 per month (to be paid in 14 installments throughout the year) or EUR 9,172.80 per year. In addition, the applicable CBA normally sets forth a higher minimum wage for each job category. Generally, the annual salary is paid in 14 installments: 12 on a monthly basis in arrears, 1 in July and 1 in December. The applicable CBA may require additional payments and/or may permit the employer to pay a pro rata portion of the additional payment each month. The minimum annual salary by law is normally increased every year. Furthermore, the salary may be increased by the CBA every year as well as a function

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of the consumer price index or other ratio, as agreed by the negotiation parties.

Mandatory Leaves (e.g., Sick, Maternity or Parental Leave) The following overview is not exhaustive, but provides a summary on Sick, Maternity and Paternity Leaves:

Sick leave The Spanish Social Security system provides partial payment to employees for time off due to job-related and non-job-related illnesses. The length of the temporary disability is 12 months, which may be extended to 18 months where the employee is presumed to recover. The quantity of and the date on which the right to the sick pay arises depends on the cause of the temporary disability, i.e., whether it is a job-related illness or a non-job related illness. Though not required by law, during sick leave, employers may choose to "make whole" the employee’s salary by paying the difference between the Social Security payments and the employee’s regular salary. This is often done for senior executives and is sometimes required by the applicable CBA.

Maternity leave Spanish law provides for maternity leave of 16 weeks for a single child, and 2 additional weeks for each additional child born. Maternity leave will be extended for an additional 2 weeks if an employee gives birth to a disabled child. Pay during maternity leave is covered by the Social Security and amounts to 100% of the employee’s Social Security contribution base, although the employer may agree to make up the difference between the Social Security benefit and the employee’s salary.

Paternity leave The father is entitled to 2 days of leave paid by the employer, or 4 days if the father is required to travel. In addition, the father is entitled to an additional 13 continuous calendar days of paternity leave in the case of childbirth, adoption or fostering. This period may be increased by 2 extra days per additional child born. This is increased to 20 days if the mother and father already have two or more children, or if a family member is disabled. During this 13-day (or more, as the case may be) paternity leave, the employment contract is suspended and the employee is entitled to Social Security benefits, although the employer may agree to make up the difference between the Social Security benefit and the employee’s salary.

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A. Collective Dismissals When will collective dismissals be triggered? When in any 90 day period or consecutive 90 day periods, a company* intends to make the following number of employees redundant: • 6 or more employees if the company will be closed; • 10 or more employees in a company with less than 100 employees; • 10% or more employees in a company with 100 to 300 employees; or • 30 or more employees in a business with over 300 employees. If, within the 90-day period or consecutive 90-day periods, there are five or more terminations at the company's initiative and for reasons unrelated to the employee, by law these terminations will also compute. * ECJ Judgment, dated 13-5-2015 (Rabal Cañas Case), established that the unit that should be taken into consideration in computing the existing number of employees and the number of employees to be laid off for purposes of the thresholds is the work center, and not, as Spanish law established, the company. We have already had at least one case where a Spanish appellate court has held redundancies null and void for failing to follow the collective dismissal procedure in contravention of the Rabal Cañas decision, despite the fact that under the Spanish Labor Act, the collective dismissal procedure was not required.

Do you need to inform/consult? If so, with whom? e.g. works council, trade unions, elected reps, individual employee Yes. The employer needs to notify the employee representatives (works council or individual personnel delegates) and the labor authorities of the commencement of the consultation process. After the notice has been provided, the employer should

then consult and negotiate with the representative commission.

What do you need to inform/ consult about? The notice of the commencement of the consultation period must include the following information: • causes for the collective dismissal; • number and professional classification of the employees affected by the dismissals; • number and professional classification of the employees habitually employed in the last year; • period during which dismissals are expected to be effective; • criteria used to select the employees to be dismissed; • copy of the notice provided to the employees or the employee representatives notifying the intent to initiate the collective dismissal procedure; and • employee representatives who will be in the negotiating commission or, if none has been established within the legally required term, a statement to that effect.

Parties to be involved in a collective dismissal Collective dismissal parties involved Parties

Spain

Supervisory Board

N/A

Works Council

Required

Trade Unions

If applicable. Indirect role, could be a party under very specific circumstances

Governmental Body

Required (Labor Authority)

Court

If applicable

Consultation During consultation, the company and representative commission discuss the reasons for the redundancies and how to avoid or reduce their effects, including the applicable severance compensation and measures such as outplacement, training to improve employability, relocation to other group companies, etc. Normally, several meetings are held throughout the consultation period and the parties should negotiate in good faith to attempt to reach an agreement.

What sanctions/penalties are there for failing to inform/consult?

Failure to follow the correct procedure (including the company's failure to provide sufficient information or documents, or acting in bad faith during negotiations) will make any notices of termination null and void and require the employees' reinstatement with back pay.

Are any other government or official approvals required? No. If the collective dismissals are significant, informally contact top level government and/or union authorities and contact external PR.

Content of a social plan The nature of the dismissals (compulsory or not) Selection criteria of redundant employees Termination dates and termination conditions (severance, early retirement notices, allowances) Redeplyment, outplacement and career guidance

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Collective Dismissals: How should the various parties be involved a) Works Council or employee representatives A consultation period with the employee representatives (Works Council or individual personnel delegates) is required before the employees can actually be dismissed. If there are no employee representatives, then the employees will need to elect an “ad hoc” representative committee for the collective redundancy procedure. The employee representatives are entitled to receive detailed information on the grounds leading to the intended collective redundancy and to issue a report before the company implements any restructuring measures. In addition, both the company and the employee representatives are required, during consultation, to discuss the reasons for the redundancies and how to avoid or reduce their effects (the social plan). Normally, several meetings are held throughout the consultation period and the parties should negotiate in good faith to attempt to reach an agreement.

b) Trade Unions Trade unions do not play an official role. If there are no employee representatives, the employees may elect that Trade Union members form the “ad hoc” representative committee. However, to the extent that employee representatives are members of unions, the unions will indirectly be involved in advising the employee representatives. In some cases, the lawyers advising the employee representatives throughout the process will be union lawyers. In major restructurings, since union-related employee representatives follow their union’s instructions, it is normally advisable to reach out to the high-level union members to unofficially involve them in negotiations.

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The employee representatives will be involved in negotiations concerning the social plan. The plan describes the course of the reorganization as well as the measures to avoid or reduce the collective redundancy effects, such as, for example, severance or early retirement packages, outplacement, training to improve employability, relocation to other group companies, etc.

d) Governmental Body (Labor Authority, which will depend on the territorial scope of the collective redundancy) Similarly to employee representatives, the employer needs to formally notify the Labor Authority about the commencement of the consultation period and submit a number of supporting documents, as well as formally inform the Labor Authority of the final outcome (whether the consultation period concludes with or without an agreement). During consultation, the labor authorities generally verify compliance with the procedure and are authorized to assist in the process at the request of either party or at its own initiative. The labor authorities can issue suggestions and warnings during consultations. Any such suggestions or warnings will not delay the consultation process, but they tend to influence the parties in the negotiations and they can be given significant weight by the courts if the dismissals are subsequently contested. At the request of both parties, the labor authorities can also officially act as a mediator in an attempt to find solutions on any issues that exist in the collective redundancy process. Additionally, the Labor Inspectorate must issue a report regarding the information and documents submitted for the collective redundancy procedure and regarding consultations between the company and the employee representatives. The report cannot delay the dismissal process, although if the dismissals are contested, the courts will give the report significant weight.

e) Court The collective redundancy can be challenged by the employees, the employee representatives or the Labor Authority. The procedure to be followed will be individual (employees) or collective (Labor Authority or employee representatives), and the first instance court decision can be appealed up to the Supreme Court.

B. Individual Dismissals On what grounds can you legitimately justify the dismissal of an individual employee? There are two types of dismissal: disciplinary and "objective". Disciplinary dismissals may be based on grounds such as repeated and unjustified lack of punctuality or attendance at work; lack of discipline or disobedience at work; breach of good faith and abuse of confidence in performing the job; or harassment of the employer. Objective dismissals are based on one or more of the following reasons: • the employee's incompetence which has come to light or arisen after the trial period has elapsed; • the employee's failure to adapt to reasonable technological developments affecting his/her position; • the employee's absence from work; and/or company requirement to phase out job positions based on organizational, productive, economic or technical grounds.

Do you need to give notice of termination? If so, how long? For objective dismissals, the employee must be given a letter of dismissal and provided with 15 days' prior notice or salary in lieu. For disciplinary dismissals, the employee must be notified in writing stating the facts giving rise to the dismissal and specifying the effective date of termination. No notice period is required.

Are employees entitled to severance compensation?

If so, how much? No, in cases of disciplinary dismissals not challenged or declared justified by a labor court. For objective dismissals, at the time the notice letter is provided, the company must simultaneously pay the employee severance compensation of 20 days' salary per year of service, with any period of less than one year of service being pro-rated by months, up to a maximum of 12 months' salary.

Do you need to involve any collective or official bodies when dismissing an individual employee? No.

What sanctions/penalties are there for getting it wrong? If the labor court finds that the alleged cause for dismissal has not been satisfactorily proven or, if it is proven, it is insufficient to justify a dismissal, the dismissal may be declared unjustified. In this event, the employer has 5 days as of the Court decision notification date to choose between reinstating the employee with back pay or paying severance compensation for unjustified dismissal. For employees hired on or after February 12, 2012 severance compensation for unjustified dismissal is equal to 33 days’ gross salary per year of employment, and any period of less than one year of service being prorated by months, up to a maximum of 24 months salary. For employees hired prior to February 12, 2012, severance compensation is computed as the sum of (i) 45 days’ gross salary per year of employment through February 11, 2012, plus (ii) 33 days’ gross salary per year worked as from February 12, 2012, the total sum being subject to a maximum of the greater of the following caps: (a) 720 days of total salary or (b) the amount of 45 days’ gross salary per year of employment through February 11, 2012, capped at 42 months of salary. However, if the dismissed employee is an employee representative, the employee representative chooses (not the employer).

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A closer look

Fermin Guardiola

What is your role within Baker McKenzie?

I am a Senior Partner of the Firm in the Employment Department in Madrid. I used to head the employment practice in Madrid, until I became Chair of the Steering Committee of our EMEA Employment & Compensation Group in 2014. As Chair of the Regional Steering Committee, I am in charge of the regionâ&#x20AC;&#x2122;s business plan, which aims above all to ensure quality and to ensure that we across the region are working as one team. In so doing, we also focus on strengthening our client relationships, on developing our strength in the market, and maintaining our competitive edge. As Chair of the Regional Steering Committee, I also serve on our Global Employment & Compensation steering committee, working closely with Guenther and the chairs of the other regions. Within the Global Steering Committee, I am in charge of qualityrelated initiatives globally.

What are the key challenges facing EMEA employers at present?

I think the key challenges employers in general are facing have to do with the world we live in today. On the one hand, the internet and developments in technology have made a vast amount of information available in real time and enabled people across the globe to communicate with each other and organize themselves at unprecedented speed. This means, for example, that unions today communicate with each other very differently from in the past; they share information across the region, and they can plan and organize measures extremely quickly and effectively. Employers thus need to be capable of managing their labor relations and responding to union initiatives regionally and quickly as well. On the other hand, though, our employment laws continue to be predominantly national laws based on local traditions, and our human resources still have expectations that are local, based on their specific nationality and/or culture. So when regional employers have to respond to regional issues or initiatives, they also need to ensure compliance with each and every set of local laws, while bearing in mind the cultural particularities of their human resources in each location. With union relations, for example, this means that an employer who is dealing with a regional union issue or initiative, at the same time has to bear in mind the very different specific local laws defining union rights, as well

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as the vastly different perceptions of unions in each jurisdiction. This is a huge challenge, because you have to balance regional issues and needs with local requirements and needs, and often you have to be able to do so in a matter of hours.

strategies, working with them to adjust their HR structures to their changing businesses, helping them expand their businesses in Spain or in other countries, assisting them in establishing and/or negotiating with European and local works councils, etc.

What are the main advantages of having a regional practice group?

Is the employment practice group targeting any of the emerging markets in the EMEA region?

I think that our regional organization working as one team allows us to best respond to the challenges our clients are facing. As a team, we can manage huge regional and global matters, with top-notch local expertise. We can respond immediately as a regional team to any major regional employment and labor issues, tapping into our vast network of offices. When an employment issue arises in Spain, for example, that can affect labor relations in France or Germany, or in Kiev, Budapest or Istanbul, the fact that we are regionally one team means that we are capable of mobilizing to help our clients resolve the issue regionally, as a whole, effectively and immediately. This is what we have experience at doing and what we, frankly, excel at. And we can do that with the backdrop of our local expertise, ensuring compliance with all local legal requirements and being fully aware of the local cultural differences that need to be taken into consideration. So our regional structure, and more generally, our global structure, in short, allows us to best serve our clientsâ&#x20AC;&#x2122; regional and global needs and provide service of an exceptional quality.

What are your main areas of focus in the world of employment law?

I mainly focus on cross border restructuring projects and labor relations, and on other matters that involve strategic issues for clients. Along with my partners in other jurisdictions, I work hand in hand with clients, helping them to identify needs and to define long term HR

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We are where are clients are, which today is basically everywhere. Evidently, in markets that have exceptional rates of growth or are expected to have significant growth in the near future, we need to bolster our local teams to ensure that we are sized appropriately. In this respect, for example, with a view to the increasing activity in Africa, we have substantially expanded our employment law team in our office in Johannesburg, which is now led by one of the worldâ&#x20AC;&#x2122;s leading labor relations experts, Johan Botes. Our Johannesburg team works closely with the rest of our offices in Africa, but also has full capacity to manage matters in all African jurisdictions. Our presence in the Middle East goes back to well before the current whirlwind of activity there. Our offices in the Gulf Area have been revamped with the hiring of Joanna Taylor, who is a well-known expert in the area. With respect to Eastern Europe, we have extremely strong employment teams in our Russian offices, Ukraine, Hungary, Czech Republic, etc. and have been handling major transactions, restructurings, and other employment matters for years. At the same time, our region works closely with other regions to identify changing client needs. We, for example, currently have a LatAm Initiative, to coordinate matters specifically between EMEA and the LatAm region, where we have a fantastic network as well.

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ARTICLE

Vivian Bij de Vaate

PhD, Vrije Universiteit (VU)

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Vivian Bij de Vaate PhD, Vrije Universiteit (VU)

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The mandatory 'transition payment' in Dutch dismissal law After many years of debate, on 1 July 2015, the Dutch employment legislation, and specifically dismissal legislation, was changed by the Work and Security Act (Wet werk en zekerheid). The reform was initiated in response to some shortcomings in the Dutch dismissal system. One of the main problems was that the amount of compensation (if any) the employee received for termination depended on the employer's choice of termination procedure. The new Act was intended to redress this inequality, as well as to speed up dismissal trials and make dismissals less costly for the employer.

The right to 'transition payment' The Work and Security Act abolished the (costly) compensatory payment (kantonrechtersformule) incurred during the dissolution procedure and instead introduced the right to a fixed compensation – the so-called 'transition payment' (transitievergoeding). This mandatory compensation fee must be paid if the related employment contract lasted for at least two years and was terminated involuntarily, regardless of

the applicable termination procedure. This means the employee is entitled to the transition payment in case of dismissal either by notice, with the prior permission of the administrative authority (known as the UWV) or the Cantonal Court, or even by the non-renewal of a fixed term contract, provided the employment contract lasted for at least two years. The transition payment amounts to one third of the monthly salary for each year of service in the first 10 years of service. After 10 years, the transition payment amounts to half of the gross monthly salary for every subsequent year of service. Employees above the age of 50 with more than 10 years of service are entitled to one monthly salary for each year of service. However, the remuneration is subject to a maximum limit of € 77,000, or one annual salary for employees earning more than € 77,000 a year. As a result of the introduction of the legally regulated transition payment, the amount of compensation is equal for every involuntarily dismissed employee, regardless of the procedure which has been followed for termination. Another idea behind the introduction of the transition payment – together with the limited (according to the legislator: clear specified) reasonable grounds for dismissal – is that, when faced with notice of dismissal, the vast majority of employees will agree to terminate their contract without going to court. This is how the Dutch legislator intends to achieve the reforms goals of speeding up dismissal trials and making dismissals less costly. However, initial studies seem to show that the Dutch employee will use the threat of a dismissal trial as a way to negotiate additional compensation above the legal transition payment.

Biography of the Author Vivian Bij de Vaate graduated in Dutch civil law at the VU University Amsterdam in 2011. Following her graduation, she started working as a teacher and researcher in employment law at the VU. In January 2015, she finished her dissertation entitled 'Extraordinary procedural dismissal law' and since then has been Assistant Professor of Labour Law at the VU. Her research is based mainly in the field of dismissal law and procedural labour law. In addition to her role at the VU, as of November 2015, she works once a week as a Professional Support Lawyer at Baker McKenzie Amsterdam. Furthermore, Vivian is editorial member of a number of Dutch Labour Law Journals and author of various labour law commentaries.

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HIRING & FIRING LAW AND KEY EMPLOYMENT TRENDS IN POLAND. KEY EMPLOYMENT TRENDS BY PIOTR RAWSKI | EMPLOYMENT LAW OVERVIEW | COLLECTIVE DISMISSALS | PARTIES TO BE INVOLVED IN A COLLECTIVE DISMISSAL | COLLECTIVE DISMISSALS: HOW SHOULD VARIOUS PARTIES BE INVOLVED? | PERSONAL INTERVIEW PIOTR RAWSKI

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Hiring & Firing law and key employment trends in Europe

Poland

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Key employment law trends in POLAND Poor performance termination

Termination of an employee based on poor performance may expose a company to legal risk as employment is considered a contract of “actions”, not “results”. In other words, an employee is expected to act with due care and diligence, but not necessarily to achieve the set results. Therefore, failure to achieve the targets set by an employer (e.g., sale goals) may not be a sufficient reason for termination, unless the employer can evidence that performance of the employee was objectively poor. It may be supported, for example, by making comparison to the results of other employees of the company. In one of its recent judgments, the Supreme Court ruled that an employee may be terminated when he or she achieves worse results than his/her colleagues, even if no lack of due care or diligence may be reported. In the said ruling, the Supreme Court provided that the employer has a right to select employees in a way it considers best and confirmed that poor performance termination does not have to take place due to the employee’s fault. However, it is difficult to predict what constitutes a sufficient reason for termination of an underperforming employee as an employee may raise opposing complaints in the court, e.g., that the set targets were not objectively achievable. Thus, poor performance termination should only take place after gathering and assessing the supporting evidence.

Garden leave When it comes to termination, the employer often prefers to let an employee go with immediate effect. In particular, in case of any kind of potential or existing conflict with the leaving individual, the business reasons would be sufficient for no longer allowing the employee to engage in the employer’s business activity. Where it is not possible to agree with an employee to leave on the basis of mutual agreement, the company may put an employee on garden leave. From a business perspective, garden leave aims to keep an employee out of the business affairs of the company to protect the employer’s confidential

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information, property and business. For many years, it was uncertain whether an employer could place a leaving employee on garden leave without his or her consent. In 2016, the labor laws have changed in this respect. Under new legislation, the employer may put the employee on garden leave based on its unilateral decision. However, to protect the employer’s business in the most efficient way, it is still advisable to split with the employee on the basis of mutual agreement. In the said agreement, the parties may decide that the employee will not work until the formal termination date, but he/she shall remain at the company’s disposal if such a need appears. Regardless of the legislation amendments, a contractual arrangement tailored to the employer’s needs may help to protect its affairs in the most efficient way.

Contract for definite period of time There are three types of contracts on the basis of which a company may employ an individual. In the first instance, an employer often engages an individual for a trial period to verify his or her suitability for the job. If, after the trial period comes to an end, the company wishes to keep an individual employed, a business decision must be made with respect to employment for either a definite or indefinite period of time. Definite employment was considered a suitable solution for the employer. However, its use was subject to significant restriction recently. Under new regulations, a company may only engage an individual for a definite term if such term does not exceed 33 months. If a company wishes to engage an employee for a longer period of time, an indefinite employment agreement should be concluded between the parties. These changes make termination more difficult as a fair reason for termination is now required. However, the labor laws provide certain exceptions under which a company may engage an employee without entering into an indefinite employment contract. Such exceptions include, for example, board members engaged for a certain term (e.g., three years) or if an objective business justification exists for such employment. However, a decision to enter into a definite employment contract based on exceptional circumstances should be always a subject to prior legal assessment.

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Employment Law Overview I Pre Hire Considerans

Pre-Hire Background/Reference Checks Permitted or Required In general, information regarding the candidate is collected by the employer directly from the applicant. False information or the failure to provide mandatory information given by the applicant in the job application that is disclosed before the employment offer is made can be legitimate grounds for the employer not to employ this applicant by discontinuing the recruitment process. Before the employment offer is made the employer may require the applicant to provide only certain information (such as name and surname, parent’s names, date of birth, place of residence (correspondence address), education, employment history) and the following documents: • originals of the documents evidencing his/her qualifications required for the position for which the applicant is applying, in particular governmental certificates or diplomas, if applicable; and • originals of employment certificates confirming the period of his/her previous employment, as required for the position for which the applicant is applying.

Pre-Hire Medical Checks/Drug Testing Permitted or Required tions Medical checks are, in principle, mandatory for all new employees. They are conducted by an "occupational medicine" doctor and are financed by the employer. Employer cannot allow an employee to work without a valid medical certificate confirming the lack of contraindications as to the work at a particular post. Drug tests are considered a violation of the employee/ candidate’s privacy, and therefore unlawful. They may be conducted upon the employee’s voluntary consent.

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II. Hiring and Employment Terms Written Employment Contract/PIIA; Language Requirements Employment contracts should be concluded in writing. If an employment con¬tract has not been concluded in writing, the employer should no later than on the date of employee’s commencement of work, confirm to the employee in writing the arrangements concerning the parties to the contract, the type of the contract and the conditions thereof. Failure to confirm in writing the concluded employment contract may be subject to a fine of up to approx. EUR 7,000. Please note, that currently written employment contract must be concluded during the employee’s first day at work. Since September 1, 2016 it will be required to conclude a written agreement before the employee starts to work. With minor exceptions, employment contracts and other employment-related documents must be concluded in Polish. If this requirement is not observed, the employer may be subject to a fine of up to approx. EUR 1,150.

Definite vs. Indefinite Term/Part-Time Employees As a rule, the period of employment under a fixed-term contract, as well as the total period of employment under fixed-term contracts concluded between the same parties of the employment relationship, may not exceed 33 months, and the total number of the contracts may not exceed three. Exceeding these limits will result in concluding a contract for indefinite period. The most significant difference between fixed-term and indefinite-term contracts is a flexibility of fixedterm contract. In principle, termination of a fixed-term contract with notice is much easier for the employer, since, contrary to an indefinite contract, there is no requirement to include in the termination notice reasons justifying the termination and if the employee challenges the termination of the fixed-term employment contract he/ she may claim only compensation (not reinstatement at work, which is possible in case of challenging the termination of indefinite employment agreements). Additionally, as a general rule, it is not necessary to consult trade unions in order to terminate a fixed-term contract with notice.

Part-time employment is allowed. Conclusion of a contract for part-time employment cannot result in the employee’s conditions of work and pay being established on a less favorable basis than applicable to employees performing identical or similar work on a full-time basis. However, the remuneration for work as well as other work-related benefits can be proportional to the amount of the employee’s working time.

Probationary Periods A probationary period cannot exceed 3 months. The renewal of the contract of employment for a trial period with the same employee is permitted only in very limited situations.

Non-Compete/Non-Solicitation A post-termination non-competition restraint is enforceable if signed (i.e., concluded in writing) by both parties, for a fixed period of time and the former employee receives a compensation of at least 25% of the remuneration received by the employee prior to cessation of the employment relationship for a period corresponding to the period of validity of the prohibition of competition. The post termination non-competition restrictions may be imposed only with respect to the employees who have access to particularly important information, disclosure of which could cause damage to the employer.

Working Hours The normal working week is 8 hours per day and an average of 40 hours per an average five-day working week within an adopted settlement period not exceeding 4 months. In principle, work on Sundays and public holidays is prohibited. Polish law contain standards for, in particular, periods of rest, working hours, night work, work on Sundays, rest breaks, overtime, and on-call shifts.

At-Will Employment At-will employment is not recognized in Poland. Termination of employment with or without notice is regulated by law (e.g., notice periods, reasons for termination without notice, etc.). Employment contract cannot contain provisions that are less favorable to the employees than the provisions of the labor code. Therefore "at-will employment" – even if accepted by the employee – will not be recognized by the court and the provisions of labor code will apply.

III. Managing Employment Relationship Performance Appraisals They are not obligatory but are advisable as they provide good evidence of an employee’s performance at any given time. They may be evidence for employee’s underperformance, which may constitute a valid reason for termination of employment (typically with notice).

Workplace Safety Rules (e.g., Posting and Consultation, Liability Insurance) Employers are responsible for the level of work safety and hygiene in the employing establishment. Employers have numerous duties concerning occupational health and safety. In particular they are obliged to: • organize work in a manner ensuring safe and hygienic working conditions; • ensure the observance in the employing establishment of the regulations and rules of work safety and hygiene; and • respond to the needs in the field of ensuring work safety and hygiene and adjust the measures taken in order to improve the existing level of protection of employees’ health and life. Employers can be liable for not observing health and safety rules and accidents at work. Employees can claim damages from their employer, unless (in principle) the damage was due to force majeure or solely to a fault of the person who suffered the damage or a third party for whom the employer is not responsible.

Anti-Discrimination/Harassment Legislation Employers are obliged to treat employees equally, particularly regardless of sex, age, disability, race, religion, nationality, political views, trade union membership, ethnic origin, religious convictions, sexual orientation and regardless of the fact of being employed for a definite or an indefinite period or on a full-time or part-time basis. Differentiation of employees is permitted only if certain conditions (specified by law) are met. In principle the burden of proof that these conditions are met (e.g., that the type of work causes the reasons like sex, age, disability etc. to be a real and decisive

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professional requirement for a given position) lies with the employer.

Data Privacy Obligations Poland has very stringent data privacy obligations. As a general rule, the employer may process only limited personal data, specified in a labor code. It is disputable whether processing other data, even with the employee’s consent, is allowed.

Unions Employees may participate in trade unions on a voluntary basis and it is prohibited to obstruct trade union activity. Trade unions have multiple rights concerning, among others: notification of termination of employment of trade union members or employees who have requested trade union protection (provided the trade union agreed), mass redundancies, transfer of establishment and collective bargaining.

Collective bargaining agreements (“CBAs”) Provisions of a CBA may not be less favorable to the employees than the provisions of the Labor Code and other Acts and implementing instruments. CBAs are mostly negotiated for a singular employer or for the whole of a capital group. CBAs mostly regulate wages, employees’ benefits, rules for termination of employment (e.g., guarantee of employment).

Works Councils Under Polish law, every employer that employs at least 50 employees is obligated to inform the employees about this headcount and may also elect the Works Council. Works Councils have specific consultation rights regarding, e.g.: activities and the economic situation of the employer, the employment structure and anticipated employment changes, activities that may lead to significant changes in the work organization or the employment basis.

Employee Representatives In principle, the employees are represented by trade unions. In some instances, if no trade unions are active in a work establishment, the employees may appoint a representative, who will be allowed, for instance, to: negotiate provisions of the remuneration scheme concerning the social fund, consult certain issues concerning health and safety, consult group redundancies, etc.

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IV. Mandatory Payments/ Benefits Compensation/Benefits (Bonuses, Benefits in Kind) An employee satisfying the conditions entitling him/ her to receive a pension due to incapacity to work or retirement pension and whose employment relationship ceased in connection with a pension or a retirement pension, have the right to cash severance pay equivalent to one month’s remuneration. In the event of death of an employee during the existence of an employment relationship the employee’s family is entitled to death benefit in the amount equal to one, three or six months’ remuneration (depending on employee’s seniority). Additionally, the employees are entitled in particular to travel allowance, overtime allowance, night work allowance, severance in case of redundancy and certain benefits resulting from health and safety rules (e.g., free drinks or hot meals – in certain situations). Based on special statutory regulations some groups of employees may be entitled to jubilee awards or 13th month salary (e.g., judges, teachers of public schools).

Sick leave Sick leave actually consists of two types of paid leave depending on who is obligated to continue salary payment during this period: • sick leave – for the first 33 days during a given calendar year (and in case of the employee who reached 50 years old – lasting 14 days in the calendar year); and then • long-term disability leave – which in principle may not exceed 182 days of continuous absence. The employer covers sick pay for up to 33 days of sick leave (in case of an employee who reaches 50 years old – 14 days in the calendar year) decreased to 80% of the employee’s average regular gross remuneration.

Maternity leave A female employee is entitled to maternity leave of: • 20 weeks – in case of single birth, • 31 weeks – in case of twin birth; • 33 weeks – in case of triple birth;

Mandatory Vacation/Holiday

• 35 weeks – in case of the birth of four children; and

Employees are entitled to a minimum number of vacation days per year equal to 20 days – if the employee has been employed for less than 10 years; and 26 days – if the employee has been employed for more than 10 years. Certain period of education are included in the employee’s seniority for purpose of calculation of vacation leave.

• 37 weeks – in case of the birth of five or more children.

Wages, including Mandatory Increases The employer is obligated to pay at least the minimum wage to its employees. Currently (2016), the minimum wage is equal to PLN 1,850 (approx. EUR 425). In principle, statutory minimum wages are indexed once per year.

Mandatory Leaves (e.g., Sick, Maternity or Parental Leave) The following overview is not exhaustive, but provides the main categories of statutory leave entitlement:

Parental leave Following maternity leave an employee is entitled to parental leave of up to 32 weeks (one child born) or 34 weeks (at least two children born). Both parents of a child may use parental leave at the same time. In such case the total length of the leave must not exceed the total statutory length. Paternal leave (also so-called "father’s leave") An employee who is a father bringing up a child has the right to paternity leave for the period of up to 2 weeks, not longer, however, than (in principle) until the child reaches the age of 24 months.

Childcare Leave Employees who have been employed by the employer for six months or more are entitled to childcare leave. The childcare leave, in general, is not paid. However, in case of families with low income, the employees may apply for childcare allowance paid by state. This leave may be taken for a maximum period of up to 36 months.

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A. Collective Dismissals

• the proposals of how the employees' situation will be solved and, if any payments are concerned, the method for calculating any redundancy payments; and • any other relevant information that may influence consultations or the agreement that the trade unions and the employer will attempt to reach.

When will collective dismissals be Consultation triggered? When in any 30 day period an employer intends to make the following number of employees redundant: • 10 or more employees in a business with 20 to 99 employees; • 10% or more employees in a business with 100 to 299 employees; or • 30 or more employees in a business with 300 or more employees.

Do you need to inform/consult? If so, with whom? e.g. works council, trade unions, elected reps, individual employee Yes. The employer will need to inform the unions of the intended redundancies and provide the required information. If there are no unions, the representatives of the employees will need to be informed.

The matters that will need consultation are: the possibility of avoiding or reducing the extent of mass lay-offs and labor issues connected with the lay-offs, including, in particular, the possibility of prequalifying or professional training, as well as finding alternative employment for employees to be laid off.

What sanctions/penalties are there for failing to inform/consult? Employees can claim that the statutory procedure was breached and seek the remedy of reinstatement or financial compensation as in cases of individual terminations by notice.

Are any other government or official approvals required? No.

The unions will then need consulting for up to 20 days from the date the information is provided. The works council shall be informed and consulted about intended mass redundancies.

What do you need to inform/ consult about? Information The following information needs to be provided: • the reasons for the planned redundancies; • the categories of employees to be made redundant; • the number and categories of employees normally employed and their job categories; • the period over which the planned redundancies are to be effected; • the criteria proposed for the selection of the employees to be made redundant and the order of redundancies;

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Parties to be involved in a collective dismissal Collective dismissal parties involved Parties

Poland

Supervisory Board

N/A

Works Council

Required

Trade Unions

Required

Governmental Body

DLO

Court

If applicable

Content of a social plan Reasons for the projected redundancies Number of affected employees and their job categories The period over which the projected redundancies will take place Selection criteria of redundant employees The order of making the redundancies Proposals on resolving the employment matters connected with the projected collective redundancies and if they cover any cash payments Note: The social plan in Poland is only applicable if you have reached an agreement with Trade Unions or via regulations issued by the employer

Collective Dismissals: How should the various parties be involved a) Works Council An employer should inform and consult the Works Council regarding an intention to conduct mass redundancies. The employer should inform the Works Council in writing of the following: the causes of the intended mass lay-offs, the number of employees and professional groups to which they belong, the professional groups of employees covered by the lay-off, the period during

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which such lay-offs will occur, the proposed criteria for selecting employees for the lay-offs, the order of employee lay-offs, and proposals as to how to resolve any labor issues connected with the intended layoffs. Where the lay-offs are covered by cash benefits, employers shall additionally present methods by which the level of these benefits shall be established. The notice should be delivered to Works Council within the deadline, in the form and within the scope enabling the Works Council to familiarize itself with the case, to analyze the information and to prepare for consultations. The internal arrangements concluded between the given employer and its Works Council may specify in detail the manner of information and consultation process that should be followed. The Works Council needs to be consulted on the intended collective dismissal at a stage where the advice of the Works Council is still relevant and the actual decision can still be influenced. The consultation with works Council should particularly concern the chances of avoiding collective redundancies or reducing the scale of collective redundancies.

b) Trade Unions The Trade Unions play an essential part in a collective redundancy process. The employer is obliged to notify the company Trade Unions in writing of the reasons for the projected redundancies, number of employees employed and job categories they belong to, job categories of employees who are subject to the projected collective redundancies, the period over which the projected redundancies are to be effected, the criteria proposed for the selection of the employees to be made redundant, the order of making the redundancies, proposals on resolving the employment matters connected with the projected collective redundancies, and, if they cover any cash payments, the employer is additionally obliged to present the method for calculating of their amounts. The consultation with Trade Unions should specifically cover the chances of avoiding collective redundancies or reducing the scale of collective redundancies, and employment matters connected with such redundancies, and specifically the chances for the employees made redundant to qualify for other jobs or to retrain, and to secure other employment. Within 20 days after receiving notification, the Trade Unions shall enter into agreement with the employer concerning the mass redundancies. If agreement cannot be reached, the terms and conditions for the proceedings in the matters related to the employees who are subject to the planned collective redundancies are be set forth in the regulations issued by the employer, who should take into consideration, to the best possible extent, proposals presented by the Trade Unions during the

consultations. If there are no Trade Unions active at the employer, generally speaking, the Trade Unions rights will respectively apply to the employeesâ&#x20AC;&#x2122; representatives elected pursuant to the procedure applied at the given employer.

c) Social Plan In Poland, Trade Unions and the employer sign an agreement (please see above) not a social plan. If such agreement is not signed within the time limit, the matters concerning mass redundancies are set forth in the regulations issued by the employer.

d) Governmental Body (District Labor Office - "DLO") In addition to the Works Council and the Trade Unions, the District Labor Office (Powiatowy UrzÄ&#x2026;d Pracy) is closely involved in the collective redundancies. Similarly to the Trade Unions, the employer needs to formally notify the DLO about the considerations regarding the intended redundancies (except for the information related to the method for calculating the amounts of payments due to the employees) (first notification). After agreement with Trade Unions has been concluded, or if the agreement cannot be concluded within the deadline, the employer is obliged to notify the DLO (second notification) in writing of the arrangements made in relation to the collective redundancies, including the number of employees employed and made redundant, and of the reasons for the redundancies, the period over which the redundancies are to be effected, and the consultation made in relation to the planned collective redundancies with the company Trade Unions or the employeesâ&#x20AC;&#x2122; representatives elected pursuant to the procedure applied at the given employer. Termination of the employment relationship with notice during the collective redundancies may not be given to the employee earlier than after the second notification is delivered to the DLO. Additionally, the termination of an employment relationship may occur no earlier than after 30 days of this notification. In the event the employer intends to dismiss at least 50 employees within a period of three months, such action should be consulted with the appropriate DLO and a certain form of outplacement should be provided to the dismissed employees. There is no particular path of consultation envisaged by law, both as to the procedure as well as to the timing of consultation.

e) Court The terminated employees may appeal to a labor court.

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B. Individual Dismissals On what grounds can you legitimately justify the dismissal of an individual employee? The employment may be terminated upon notice due to reasons attributable to the employer (e.g., reorganization and liquidation of employee’s job post) or reasons related to the employee (e.g., poor performance). The employment may be terminated by the employer with immediate effect if an employee: • significantly breaches his/her basic duties; • commits an offence that makes him/her incapable of performing his/her duties, provided such an offence is obvious or is confirmed by a valid court verdict; or • loses the qualifications to perform his/her job in a given position. The employee may terminate the employment without notice (i.e., with immediate effect) when the employer has committed serious violations of basic duties towards the employee or if a medical certificate has been issued stating that the work performed by the employee constitutes a health hazard, and the employer does not transfer the employee within the time limit specified in the medical certificate to another work environment appropriate to his/ her health condition and his/her occupational qualifications.

Do you need to give notice of termination? If so, how long?

Yes, if the employment is terminated (by either party upon notice). The length of the notice period depends on the type of employment agreement concluded and terminated as well as the employee’s seniority. In case of an employment agreement concluded for an indefinite period of time and fixed term employment agreements, if an employee has worked: • less than 6 months - 2 weeks’ notice should be given; • between 6 months and 3 years - 1 month’s notice should be given; or • at least 3 years - 3 months’ notice should be given. If an employment agreement concluded for a probationary period of time is terminated upon notice, the applicable notice periods are:

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• 3 working days if the probation period does not exceed 2 weeks; • 1 week if the probation period is longer than 2 weeks; and • 2 weeks if the probation period is 3 months. If the employee is at fault for the employment termination, the employer may terminate employment without notice, provided it terminates the employment agreement within one month of obtaining the information justifying such a termination.

Are employees entitled to severance compensation? If so, how much? In certain circumstances, employees with whom the employment agreement is individually terminated are entitled to statutory severance payment. This is applicable to employers employing at least 20 employees, and terminating the employees due to reasons not attributable to the employees (within mass redundancy procedures and in individual redundancy cases). The amount of the statutory severance payment depends on the period of employment with the current employer and is equal to: • 1month's remuneration, if the employee has been employed with the current employer less than 2 years; • 2 months' remuneration, if the employee has been employed with the current employer for between 2 and 8 years; and • 3 months' remuneration, if the employee has been employed with the current employer for more than 8 years. The employer is entitled to cap the amount of the redundancy payment at15 times the minimum remuneration for full time employees (in 2016 it is PLN 18,500).

Do you need to involve any collective or official bodies when dismissing an individual employee? Yes, the employer is obliged to consult the individual terminations (in certain cases even obtain trade union's consent) of members of the trade union or employees who requested the trade union's protection.

What sanctions/penalties are there for getting it wrong? If a termination is deemed unfair or illegal, the labor court may, at the employee's request, decide that: â&#x20AC;˘ the notice is ineffective â&#x20AC;˘ the employee be re-employed in the event that an employment agreement was terminated (as was concluded for an indefinite period of time); or â&#x20AC;˘ or the employee be paid compensation.

Any compensation payable may be equal to the salary for the period of two weeks to three months, but not less than the salary due for the notice period.

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A closer look

What is a typical day at the office like for you? Piotr Rawski

What is your role within Baker McKenzie?

Locally, I run the Employment department of the Warsaw office. On an international level, I serve as a member of the EMEA Employment Steering Committee, a body that coordinates the work of all EMEA Employment departments.

Why did you choose to work at Baker McKenzie? Partly it was a coincidence, as Baker McKenzie was looking for new hires and I was ready to move on with my career, and partly because of Baker McKenzie’s reputation of being a good place to work – both for its atmosphere and career-wise.

I start with coffee – it’s a must. Then I need to clear the field to start my client work – I dive into e-mails that arrived overnight from different time zones, answer those that require my personal attention and distribute others among my team. I do a bit of admin work and usually at midday I start working for clients. I do not take a lunch break but instead take a refreshing break around 3-4 pm for about 30 minutes, when I’ll try to have coffee outside if the weather permits. I try to disconnect during such break.

What do you like best about your job?

It is difficult to answer this question as this means “choose one thing” only. But accepting this challenge I would say that I like the team, both the local one I have gathered and the international one I have the honor to be part of. Baker McKenzie is so much different than other law firms I know. It’s just a great and friendly place to be in.

What's your greatest accomplishment? Again – my solid team. We have stuck together with very low attrition for many years, we’re constantly growing, and we have excellent personal relationships – based on trust and respect – in both directions.

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INTERVIEW by Mirjam de BlĂŠcourt

Claartje van Fulpen

Member of the European Board of Directors, Mitsubishi Caterpillar Forklift Europe B.V.

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Claartje van Fulpen

Member of the European Board of Directors, Mitsubishi Caterpillar Forklift Europe B.V.

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What is your current job position? Member of the European Board of Directors, which comprises four people and of which I am the only female. I am responsible for Legal, HR, Internal Control, IT and Corporate Communication.

What has been your biggest challenge so far? Handling a large reorganization for a company of our scale and size in a smooth and humane manner, treating all parties involved respectfully, whilst at the same time creating an environment in which the remaining teams and employees are still functioning properly and stay motivated in the changing organization. Additionally, we needed to make sure that the company would - post-reorganization - stay on the chosen and successful track.

What makes your What do you look job interesting? for in an advisor? I work in a very diverse organization encompassing a range of cultures (including Japanese). Sometimes, this means walking on eggshells. I am driven to make successful and meaningful decisions to bring the company forward and gain the trust of all the different stakeholders within the legal risk management framework.

To me, it is important to have the support of excellent legal advisors who can act as sparring partners. This requires a deep understanding of the business and the culture, and an ability to really place yourself in the shoes of the person who receives the advice. In this sense, I really enjoy working with you and the wider Amsterdam Employment team. The team is creative, able to think outside of the box (but within the legal framework) and able to give me tactically savvy and pragmatic advice. I also connect with you on a personal level. You have a sparkling personality, are very easy going and good fun to work with.

Mirjam: Thank you so much, youâ&#x20AC;&#x2122;re too kind! I also enjoy working with you and I fully agree that we make a great team. What I most admire about you is that you are able to incorporate the long-term strategy and goals in your decision-making process and that you manage to maintain a helicopter view. You are excellent at coordinating work and seem to always be in high spirits and full of energy.

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HIRING & FIRING LAW AND KEY EMPLOYMENT TRENDS IN THE UNITED KINGDOM. KEY EMPLOYMENT TRENDS BY CHRISTINE O'BRIEN | EMPLOYMENT LAW OVERVIEW | COLLECTIVE DISMISSALS | PARTIES TO BE INVOLVED IN A COLLECTIVE DISMISSAL | COLLECTIVE DISMISSALS: HOW SHOULD VARIOUS PARTIES BE INVOLVED? | PERSONAL INTERVIEW CHRISTINE O'BRIEN

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Hiring & Firing law and key employment trends in Europe

United Kingdom

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Key employment law trends in UK

pay or GBP 78,962, whichever is the lower. For some would-be claimants, this means that unfair dismissal claims not only cost more, as a result of fees, but are also worth less than the potential compensation. As employers will know, however, the ongoing decline in claims does not necessarily mean a decline in workplace disputes. The UK government wants to see more disputes being settled rather than litigated and, since 2014, it has been compulsory for the specialist independent conciliator ACAS (Advisory, Conciliation and Arbitration Service) to attempt to achieve the settlement of a dispute before it can proceed to an Employment Tribunal. However, many disputes are settled before the ACAS pre-claim conciliation stage and we are still seeing significant numbers of settlement agreements being negotiated with employees as a means of achieving a termination on agreed terms.

Looking ahead to the long term, the key question in the UK is the extent to which employment law might change following Brexit. Ultimately this will depend on our future relationship with the Family leave is increasingly complicated European Union, the nature of In 2015, the UK introduced a new system of shared which is currently unclear. There parental leave, which allows mothers (or adopters) to share some of their 52 weeks’ maternity (or adoption) have been no immediate changes leave with their partner. The system is designed to give flexibility to parents, allowing parents to take resulting from the Brexit vote, but turns being on leave or to both be on leave at the same time. As our recent client survey confirmed, we continue to see other legal employers are finding the new system complicated. This complexity looks set to continue, given the reforms and developments. We government’s plans to extend shared parental leave to working grandparents by 2018. These plans would have highlighted some of the key allow mothers (or adopters) to share leave with a grandparent rather than their partner. Most of the trends below. respondents to our survey considered the take-up of Decline in Employment Tribunal claims and reduced compensation for unfair dismissal Claims against employers have declined sharply since 2013, when fees were introduced in UK Employment Tribunals. Most claims now cost claimants at least GBP 1,200 and, while successful claimants can recover this from their employers, the latest statistics suggest that fees are continuing to deter claimants from pursuing claims through to a full hearing. The introduction of fees is not necessarily the only reason why unfair dismissal claims are in decline. In the UK, compensation for unfair dismissal has always been subject to an upper limit (currently GBP 78,962) on top of a smaller basic award, determined by length of service and age. Since 2013, however, there has been an additional upper limit: in addition to the basic award employees can now recover either 52 weeks’

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shared parental leave by men to be low. It remains to be seen if take-up by grandparents will be higher.

Significant shift in risk involved in calculating holiday pay Holiday pay was once a topic which rarely came up for discussion in the UK, as it was not thought to involve any material risk. Today, however, calculating holiday pay is a hot topic, which is the subject of ongoing litigation. The Court of Justice of the European Union has ruled that the UK legislation for calculating holiday pay does not meet the requirements of the Working Time Directive for payment of ‘normal remuneration’ for holidays. We now have a series of UK court decisions ruling that compulsory overtime, variable allowances and commission payments should be included in holiday pay, despite UK legislation saying otherwise. We await further rulings on the approach employers should be taking, and on which other payments (especially voluntary overtime) may need to be included in holiday pay. The ultimate outcome of

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the UK’s Brexit negotiations may impact on the extent to which this issue will be driven by EU law. In the meantime, employers are continuing to scrutinize their own arrangements and evaluate the risks.

Corporate reporting requirements – change through transparency rather than regulation The Modern Slavery Act 2015 requires large employers to publish an annual statement disclosing what steps they have taken to ensure that slavery and human trafficking is not taking place in their supply chains or business. From April 2017, large employers will also be required to publish details of their gender pay gap, that is, the difference between what women and men are paid, on average, across their organization. Both initiatives are intended to achieve change not by the introduction of new legal requirements as such (i.e., to eradicate slavery or reduce the gender pay gap) but instead by requiring employers to be transparent about their practices.

Employment Law Overview I Pre Hire Considerans Pre-hire background checks are generally not required by law and are relatively uncommon for most jobs in the UK. Generally, background checks that involve enquiries to third parties are only permitted where: (i) there is a significant risk to the employer, its customers or its clients due to the job position at issue (e.g., financial-related positions etc.); and (ii) other less intrusive means of obtaining the information are not available. Where permitted, background checks must be proportionate to the nature of the position and the check must be limited only to that information that is directly related to the job position (and so may have a direct impact on the employment decision). In practice, before conducting a reference or background check, an employer should inform the applicant how it intends to conduct the check (i.e., the process and methods it intends to use) and obtain the applicant’s consent to such a check.

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Pre-Hire Medical Checks/Drug Testing Permitted or Required tions Pre-hire medical checks are only permitted in very limited circumstances when the employer needs to be sure that the employee is physically able to undertake the role. Disability discrimination legislation in the UK provides that an employer must not ask about the health of an applicant before making an offer of employment other than where limited exceptions apply. Similarly, there are only very limited situations where a prospective employer can require alcohol/drug testing, e.g., where the health and safety of colleagues or the public might be an issue, or where drug or alcohol abuse in a particular job would compromise the individual’s and employer’s integrity, such as employees working for the police. All requests for such testing must be justified, necessary and proportionate.

II. Hiring and Employment Terms Written Employment Contract/PIIA; Language Requirements Employment contracts can be either written, oral, express or implied. In practice, most employees in the UK have a written contract of employment. Although there is no legal obligation on employers to give written contracts of employment, they are nonetheless required by law to give employees “written particulars” of their main terms and conditions of employment within two months of starting employment. Any changes to the written particulars of employment must be notified to employees within four weeks of the change having taken place. There is no formal requirement that the contract of employment must be written in English, although this is almost always the case.

Definite vs. Indefinite Term/Part-Time Employees Employees can be hired indefinitely (known as a permanent contract in the UK) on a full-time or parttime basis subject to termination by either party by giving a specified period of notice which cannot be less than the statutory minimum periods. Part-time employees are protected from being treated less favorably than comparable full-time workers,

unless the employer can justify the less favorable treatment on objective grounds.

In practice, for most workers, the basic working week is 37 to 40 hours.

Employees can also be hired for a definite term (known as a fixed term in the UK) which may or may not be subject to termination on notice.

All workers are entitled to minimum daily rest breaks and minimum weekly rest periods.

Any employee who has four years’ continuous service under a fixed-term contract will be deemed to be working under an indefinite-term/permanent contract if the contract is subsequently renewed, unless the continued use of a fixed-term contract can be objectively justified. Fixed-term employees are protected from being treated less favorably (either in their contractual terms or employment conditions) than comparable indefinite-term/permanent employees, unless the treatment can be objectively justified.

Probationary Periods Trial or probationary periods are common but the scope and terms of the period should be set out in the contract of employment. Trial periods typically last from three to six months, involving either formal or informal assessments before the employment is made permanent. It is common for an employer to reserve the right to extend the trial period (at its discretion).

Non-Compete/Non-Solicitation The starting position in the UK is that post termination non-compete and non-solicitation restraints in an employment contract are void as a matter of public policy. However, courts will enforce such provisions, provided that the restraints go no further than is necessary to protect the legitimate business interests of the employer. The courts look at all aspects of the post-termination restraint, including its duration, geographical restrictions, limitations on the description/nature of customers and products/services, etc. Each aspect has to be reasonable bearing in mind the nature of the employee’s job, his/her status and the risk of damage to the employer’s business. Restraints in excess of one year are generally unlikely to be enforced.

Working Hours The maximum working week for workers is an average of 48 hours. This is usually calculated by taking the average hours worked over a rolling 17-week reference period. It is possible for workers to voluntarily opt out of the maximum 48-hour working week provisions through express written agreement, which the worker can revoke at any time on giving notice.

Different rules apply to night workers.

At-Will Employment The concept of “at-will” employment is not recognized in the UK. Any changes to terms and conditions will generally require the employee’s consent.

III. Managing Employment Relationship Performance Appraisals Performance appraisals are not compulsory, but are advisable as they can be used to provide evidence of an employee’s performance.

Workplace Safety Rules (e.g., Posting and Consultation, Liability Insurance) Employers have extensive statutory obligations to provide a safe working environment, breach of which could result in substantial penalties. Employers with five or more employees have a legal duty to have a written health and safety policy and to bring it to employees’ attention.

Anti-Discrimination/Harassment Legislation It is unlawful to discriminate (directly or indirectly), victimize or harass employees on the basis of their sex, marital and civil partnership status, pregnancy or maternity, gender reassignment, race (which includes ethnicity, national origin, nationality and color), sexual orientation, disability, religion or belief, or age. These grounds are referred to in the legislation as the “protected characteristics”. The concepts applicable to disability discrimination differ slightly compared to the other protected characteristics. In addition to the above, disability discrimination can also occur where a disabled person is treated unfavorably because of something arising in consequence of their disability (unless this can be justified on objective business grounds) or where the employer fails to make a reasonable adjustment where working arrangements or physical features of particular premises place a disabled employee at a substantial disadvantage.

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The UK anti-discrimination law covers all aspects of the employment relationship, including recruitment, the provision of terms and conditions of employment, promotion, training and dismissal. It also applies in certain circumstances after the end of the employment relationship, for example, when references are provided.

Data Privacy Obligations Provided that the employer is careful about the type of data that it obtains from employees and the data collected is adequate, relevant and not excessive and is processed for limited purposes, the employer is generally able to justify processing non-sensitive employee personal data without the need to obtain employee consent. The employer can process sensitive personal data (i.e., information relating to employees’ physical or mental health, sexual life, religion, racial or ethnic origin, and trade union membership, etc.) where it is necessary: (i) to perform or exercise any right or obligation imposed by law in connection with their employment; (ii) for the purpose of or in connection with legal proceedings or to obtain legal advice; or (iii) to establish, exercise or defend legal rights. Where the other processing conditions cannot be met, the employer needs to obtain the employees’ “explicit” consent. In addition to the above, employers should ensure that all employee personal and sensitive personal data is accurate and up to date, is kept securely, and is not retained for longer than is necessary.

Unions A trade union is a permanent or temporary organization consisting wholly or mainly of workers of one or more descriptions, and one of its principal purposes is the regulation of relations between workers and employers. Trade unions offer their members a variety of services, including representing them in various ways (particularly in disciplinary meetings), offering them legal and other advice, negotiating with employers on their behalf, and representing them in tribunals.

Collective bargaining agreements (“CBAs”) Employers can agree to recognize a trade union. In this situation, voluntary recognition can be at different levels and for a variety of purposes, but at the basic level it means that an employer agrees to the trade union playing a certain role in representing one or more groups of employees within a particular unit or

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the undertaking as a whole. Most recognition in the UK is voluntary. However, legislation also exists giving independent trade unions a legal right to request statutory recognition for collective bargaining purposes from employers. This right only applies to employers with at least 21 workers. Where a union is recognized, collective bargaining covers, at a minimum, pay, hours and holidays, although the employer and trade union can agree on additional topics.

Works Councils There are no formal works councils in the UK, the closest concept being an employee information and consultation forum (“I&C Forum”). Employees in businesses with 50 or more employees have the right to require the employer to set up an I&C Forum, which has the right to be informed and consulted on a regular basis about issues in the business for which they work. Employers which are heavily unionized will generally not have an I&C forum, since the trade union undertakes that role. However, many employers do have both, usually because a significant part of their workforce is not covered by the trade union recognition arrangement. The two bodies have different functions within the business, although there will be issues that both bodies need to be informed about or consulted about, including, for example, collective redundancies or TUPE transfers.

Employee Representatives A trade union representative is elected by trade union members to represent some or all of the members in the collective bargaining process with their employer. The representative can be a member who is also an employee of the business, or an employee of the independent trade union itself, or any other member of the trade union. Any trade union member may put forward his or her candidacy for election, unless it would be reasonable to exclude him or her from so doing. The representative’s role is to ensure that all employees’ views are properly represented.

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Health and Safety Employers must consult workers and/or their representatives, providing information on health and safety matters and allowing their participation in the discussion of such matters. In a unionized undertaking, the trade union may appoint an employee in the undertaking as a safety representative to review health, safety and welfare arrangements. In a nonunionized undertaking, the employer must inform and consult either each employee individually or the employees’ elected representative. TUPE Transfers and Collective Redundancies In a unionized undertaking, any recognized trade union representatives must be informed and consulted about certain aspects of a TUPE transfer (i.e., Transfer of Undertakings (Protection of Employment) Regulations) and about collective redundancies (i.e., where an employer proposes to dismiss 20 or more employees at one establishment within a rolling 90-day period). In a non-unionized undertaking, the employer can either consult previously elected employee representatives who have the authority of affected employees or it can invite the affected employees to elect representatives specifically to represent them in this area.

IV. Mandatory Payments/ Benefits Compensation/Benefits (Bonuses, Benefits in Kind) Some employees, particularly those who are senior or involved in sales, are paid a bonus or commission (or both) as part of their remuneration. The bonus may either be a discretionary annual bonus based on the overall profits of the company, or it may be part of a formal bonus scheme entitling the employee to a contractual bonus based on the attainment (either by him or her and/or the company) of certain specified objectives. Benefits in kind take various forms and vary according to the size of the employer and seniority of the employee. Typical benefits in kind include: company cars and free petrol, medical and disability insurance, life assurance and occupational pensions.

Mandatory Vacation/Holiday All workers who work a five-day week are entitled to 28 days’ paid holiday a year, which can include the eight usual UK public and bank holidays. Part-time workers have a right to pro-rata leave.

Wages, including Mandatory Increases Generally, it is for the parties to agree the appropriate levels of salary. However, there is a National Minimum Wage, which is currently GBP 6.70 per hour for workers aged 21 or more, GBP 5.30 per hour for 18 to 20 year olds and GBP 3.87 per hour for 16 and 17 year olds. An apprentice must be paid GBP 3.30 per hour. It rises periodically, generally in October of each year. From April 1, 2016, a new mandatory National Living Wage was introduced for workers aged 25 and above, initially set at GBP 7.20 per hour. The National Minimum Wage continues to apply to those aged 16 – 25 with the premium added for those aged 25 and over. It is customary in the UK for wages to be reviewed (although not necessarily increased) annually.

Mandatory Leaves (e.g., Sick, Maternity or Parental Leave) The main categories of statutory leave are:

Sick leave Employers are required to pay Statutory Sick Pay (“SSP”) to employees who have been sick for at least four or more days in a row, and who have average earnings of at least (currently) GBP 112 a week. Employees are entitled to up to 28 weeks’ SSP in any period of incapacity for work or in any series of linked PIWs.

Pay to employees on maternity leave for a maximum of 39 weeks (subject to meeting certain eligibility requirements, including having 26 weeks’ continuous service as at the 15th week before the expected week of childbirth).

Paternity leave The spouse, civil partner or partner of a child’s mother or adopter may take a maximum of two weeks’ paternity leave if they have been continuously employed for a period of not less than 26 weeks ending with the week immediately preceding the 14th week before the expected week of childbirth. Statutory paternity pay is payable by employers.

Adoption leave Employees who are newly matched with a child for adoption are entitled to take up to 52 weeks’ adoption leave (subject to meeting certain eligibility requirements including having 26 weeks’ continuous service at the date the employee is newly matched with a child). Employees are entitled to statutory adoption pay which operates in a similar way to statutory maternity pay.

Shared parental leave On April 5, 2015 a new system of shared parental leave was introduced in the UK. Under this system, the mother can choose to curtail up to 50 weeks of her 52-week maternity leave entitlement, which can then be shared between the mother and her partner/the child’s father, provided that each of them meets the relevant qualifying criteria in their own right. It is common for employers in the UK to offer enhanced family leave/sick leave benefits to employees.

Time off for antenatal care

Parental leave

Pregnant employees are entitled to reasonable paid time off for antenatal care. Fathers and partners of pregnant women are entitled to unpaid time off to attend up to two antenatal appointments.

Parental leave is a form of statutory unpaid leave. Eligible employees are usually entitled to take up to 18 weeks’ unpaid statutory leave to care for their child up until the child’s 18th birthday (a maximum of four weeks’ leave per child may be taken in any year). To be eligible, the worker must be an employee, have been continuously employed for one year and have, or expect to have, responsibility for a child.

Maternity leave Pregnant employees are entitled to 52 weeks’ statutory maternity leave, regardless of length of service. All employees must take a minimum of two weeks’ maternity leave starting with the day on which childbirth occurs (four weeks where the employees are factory workers). Employers are required to pay Statutory Maternity

Time off for dependents Employees may take a reasonable amount of unpaid time off during working hours in order to take action which is necessary to help or care for a dependent in an emergency and to make any necessary long-term

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arrangements. A dependent is defined as a spouse, civil partner, child or parent (but not grandparent) of the employee, or a person who lives in the same household as the employee (excluding tenants, lodgers, boarders and employees).

Time off for training Employees working for employers with 250 or more employees are entitled to request time off work to undertake study or training. Only employees with at least 26 weeks’ continuous service are entitled to make this request and the training must be for the purpose of improving their effectiveness at work and the performance of their employer’s business, although it need not lead to a formal qualification.

Public duty leave Employees are entitled to reasonable time off during normal working hours to carry out certain public duties including jury service and reserve forces duties. There is no right to be paid for time off for public duties and it is left to the employer’s discretion (subject to any provision in the employee’s contract) to decide whether to pay employees during their absence.

A. Collective Dismissals When will collective dismissals be triggered? When there is a proposal to make 20 or more employees redundant at one establishment within a period of 90 days. An “establishment” is generally the unit to which the workers made redundant are assigned to carry out their duties.

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Do you need to inform/ consult? If so, with whom? e.g. works council, trade unions, elected reps, individual employee. Yes The employer has an obligation to provide certain information to, and consult with, appropriate representatives of the employees potentially affected. Where the employer has recognized a trade union in respect of the employees affected, the union is the appropriate consulting body. If there is no union, another established representative body, such as a Works Council, can act as the consultative body provided that that function is within its remit. If no appropriate body already exists for collective consultation purposes, the employer is under an obligation to make arrangements for the election of employee representatives. The employer must also carry out individual redundancy consultation with employees.

What do you need to inform/consult about? Information The following information must be provided to the employee representatives in writing: • the reasons for the proposed redundancies; • the number and categories of employees who the employer proposes to make redundant and the total number of such employees employed at the establishment in question; • the proposed method of selecting employees for redundancy; • the proposed method of making the redundancies effective including the timescale; • the proposed method of calculating the amount of redundancy payments to employees; and • details of the number of agency workers working at the employer, the parts of the business in which they are working and they type of work those agency workers are carrying out.

Consultation The consultation process must include consultation about ways of: avoiding the dismissals; reducing the numbers of employees to be dismissed, and mitigating the consequences of the dismissals, e.g., severance compensation. Consultation must be undertaken in good faith “with a view to reaching agreement” but there is no obligation to reach agreement.

What sanctions/penalties are there for failing to inform/consult?

Failure to comply with the information and consultation obligations can result in a maximum penalty of up to 90 days’ gross pay for each affected employee. It does not, however, render the dismissals invalid.

Are any other government or official approvals required? Yes. The employer must notify the Secretary of State for the Department for Business, Innovation and Skills (“BIS”) where it is proposing to make collective redundancies no later than 30 days before the first of the dismissals (where 20 or more employees, but less than 100, are being dismissed), or 45 days before the first of the dismissals (where 100 or more are being dismissed). An HR1 form should be used for this purpose.

Parties to be involved in a collective dismissal Collective dismissal parties involved Parties

United Kingdom

Supervisory Board

N/A

Works Council

If applicable

Trade Unions

If applicable

Governmental Body

BIS

Court

If applicable

Failure to notify BIS is a criminal offence, giving rise to payment of a potentially unlimited fine. Each of the employee representatives should be given a copy of the HR1 form at the same time as the other written information is provided to them.

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Content of a social plan Reasons for the proposed redundancies Number and categories of employees who the employer proposes to make redundant and the total number of such employees employed at the establishment in question Proposed method of selecting employees for redundancy Proposed method of making the redundancies effective, including the timescale Proposed method of calculating the amount of redundancy payments to employees Details of the number of agency workers working at the employer, the parts of the business in which they are working and they type of work those agency workers are carrying out

Collective Dismissals: How should the various parties be involved Supervisory Board The concept does not exist in the UK.

Employee Representatives - Works Councils and Trade Unions The employer has an obligation to provide certain information to, and consult with, appropriate representatives of the employees potentially affected. Where the employer has recognized a Trade Union in respect of the employees affected, the union

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is the appropriate consulting body. If there is no union, another established representative body, such as a Works Council, can act as the consultative body provided that that function is within its remit. If no appropriate body already exists for collective consultation purposes, the employer is under an obligation to arrange for the election of employee representatives.

Social Plan There is no concept of social plan in the UK. In the UK, the following information must be provided to the employee representatives in writing: (i) the reasons for the proposed redundancies; (ii) the numbers and categories of employees who the employer proposes to make redundant and the total number of such employees employed at the establishment in question; (iii) the proposed method of selecting employees for redundancy; (iv) the proposed method of making the redundancies effective, including the timescale; (v) the proposed method of calculating the amount of redundancy payments to employees; and (vi) details of the number of agency workers working at the employer, the parts of the business in which they are working and the type of work those agency workers are carrying out. The consultation process must include consultation about ways of: avoiding the dismissals; reducing the numbers of employees to be dismissed, and mitigating the consequences of the dismissals, e.g., severance compensation.

BIS The employer must notify the Secretary of State for the Department for Business, Innovation and Skills (â&#x20AC;&#x153;BISâ&#x20AC;?) where it is proposing to make collective redundancies no later than 30 days before the first of the dismissals (where 20 or more employees, but less than 100, are being dismissed), or 45 days before the first of the dismissals (where 100 or more employees are being dismissed). An HR1 form should be used for this purpose. Failure to notify BIS is a criminal offense, giving rise to payment of a potentially unlimited fine.

Court Claims can be brought in the Employment Tribunal for breach of the information and consultation requirements, and unfair dismissal.

B. Individual Dismissals

Many UK contracts of employment include a payment in lieu provision that entitles an employer to pay the departing employee in lieu of the employee working out his/her notice period. If payment is made in lieu, the contract of employment will terminate at the point at which the payment is paid.

Are employees entitled to On what grounds can you severance compensation? If so, legitimately justify the dismissal of how much? an individual employee? A “fair” reason, which includes: • redundancy; • misconduct; • capability; • where continued employment would breach a statutory duty; and • “some other substantial reason”. As well as having a fair reason, the employer must follow a fair process before dismissal, otherwise the dismissal will be unfair.

UK law only provides for mandatory severance for redundancy dismissals.

To be entitled to statutory redundancy pay, employees must be continuously employed for a period of 2 years ending with the relevant date. The amount of the payment is calculated on a sliding scale based on the employee’s age, length of continuous service and salary and is a multiple of the employee’s gross weekly pay for each complete year of service, as follows:

Generally yes.

• half a week’s pay for each year of service when the employee was aged 22 and under; • one week’s pay for each year of service when the employee was over 22 but under the age of 41; and • one and a half week’s pay for each year of service when the employee was aged 41 and above.

With the exception of gross misconduct, gross negligence or other serious breaches of contract by the employee which would entitle the employer to summarily dismiss without notice, all other dismissals require the employer to give due notice.

Only a maximum of 20 years’ service is taken into account. A “week’s pay” for this purpose is currently capped at GBP 479 per week (reviewed on April 6 each year). The current maximum statutory redundancy payment is GBP 14,370.

The required notice period is usually specified in the employment contract, although is subject to the statutory minimum periods. Any contractual notice period must be equal to, or more generous than, the statutory minimum or it will not be enforceable.

An employer will also have an obligation to make an enhanced redundancy payment if the employee has a contractual right to such a payment.

Do you need to give notice of termination? If so, how long?

The statutory minimum notice period is one week if the employee has been employed for at least one month but less than 2 years, and thereafter one week per complete year of service up to a maximum of 12 weeks’ notice after 12 years of service. Where an employment contract does not specify a notice period, then “reasonable notice” will be implied into the contract.

Do you need to involve any collective or official bodies when dismissing an individual employee? No

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What sanctions/penalties are there for getting it wrong? Where there is no “fair” reason for a dismissal, or the procedure followed is not reasonable in the circumstances, the dismissal will be unfair for the purposes of UK legislation. An Employment Tribunal will decide what remedy to award – being reinstatement, re-engagement (e.g., in a comparable job) or compensation. Orders for reinstatement and re-engagement are rarely made. The employee can claim compensation made up of a “basic award” and a “compensatory award”. The basic award is an automatic award linked to length of service, age and salary and is currently capped at GBP 14,370.

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The compensatory award (which is paid in addition to the basic award) is capped at the statutory compensatory award limit, which increases annually (currently GBP 78,962) or at an amount equal to 52 weeks’ pay (whichever is lower). The compensatory award is linked to the employee’s actual financial losses and will usually depend on the likelihood of the employee finding alternative employment. Compensation for discrimination is uncapped. In cases of breach of contract, the employer will be liable for any contractual damages that the employee may prove or may have contractually agreed, which can sometimes be significant.

A closer look

Why did you choose to work at Baker McKenzie? Christine Oâ&#x20AC;&#x2122;Brien

What is your role within Baker McKenzie?

I am Senior Counsel within the London office employment department of Baker McKenzie. I am the immediate past head of the London office employment law practice and am a former Chair of our EMEA employment group. Apart from advising clients both locally and internationally, I enjoy listening to clients about their HR strategy, how the world is changing for them, and what they believe they need to do to meet those challenges. Those discussions do not involve giving legal advice as such, but are more around thinking what can be done to help businesses, and advising on the degree of risk involved in taking new or different paths. My role also means that I act as a sounding board for other senior colleagues in the department around project management, staffing and how best we can use our resources. I am interested in innovation in the delivery of legal services, and so have been at the forefront of a more managed service offering, which is quite different from the traditional way of interacting with clients.

I joined Baker McKenzie approximately 26 years ago, quite simply because it was the only truly international firm, and offered unique career experiences. There was nothing like it in the legal world at the time and I still believe that to be true today. From time to time staff have left the firm, but when they attend our alumni events they all speak with great fondness of their time with us, and refer to the abilities of our people and the quality of our client list, which they find is not replicated elsewhere. They tell us we should not under estimate that â&#x20AC;&#x201C; and we do not.

What is a typical day at the office like for you?

I tend not to start early. Typically I would arrive in the office at 10 am, but will have been looking at my emails before then. I find that slightly later start suits very well. This is particularly because I do a lot of work for US clients based on the West Cast of the US. That work is often done during the UK evening, given the time difference, and I do not mind being in the office sometimes quite late. I work with many associates in the office, trainees and para legal too, depending on the task in hand. Some of my role is to supervise their work, and I am also coach to 4 of the lawyers. I enjoy being a coach because it makes you think about the development of others in a way that there would otherwise simply not be enough time for.

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During some part of every day I have an admin catch up with my PA, Karen Baker. No, she is not related to Baker of Baker McKenzie, but she certainly takes personal ownership of her tasks as if she was. She is a great support, and I donâ&#x20AC;&#x2122;t know where I would be without her.

What do you like best about your job?

My job satisfaction comes from helping clients reach solutions. I am a very keen promoter of mediation or some other form of dispute resolution. Litigation often does not make the parties feel any better about things, whereas mediation with a suitable commercial compromise can. I also relish the chance to get to know new clients, facing new business opportunities. Partnering with them as a lawyer and ensuring they have the best possible team not just in the UK but also globally help them is hugely satisfying. Finally, my role has enabled me to get a line of sight into the future of work. We are facing a new renaissance in terms of how people will need to adapt their working lives to meet the challenges of the future. I am very lucky to be a senior employment lawyer at this particular point in time.

What's your greatest accomplishment? Undoubtedly getting my picture on the front page of the Financial Times here in London. Some years ago I represented a client in a large discrimination claim, which was amongst the first to receive widespread publicity in the newspapers and on television. Insofar as press coverage was concerned, I quickly learned that if you walked beside the witnesses on the way into Court the editor would simply chop you out of the picture, because no one is interested in the lawyer. I decided to walk behind the client, with my head always just over their shoulder, which I calculated would make it much harder for the picture editor to cut me out. Sure enough it worked. My family were very proud.

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