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Flexible forms of employment have been instrumental in tackling the adverse effects of coronavirus on entrepreneurship. They will also be a means of managing the deep recession we have already entered. However, they will remain present and will be further utilized. Anyone can confirm this – without, in fact, having special knowledge or foresight. Let’s face it. The future ahead of us cannot be the same as the past. This also goes for labor relations.

Can we react?

Of course! We can choose what the ostrich (allegedly) does in the face of danger. Let’s put our heads in the sand! To pretend the non-existence of what we have before our eyes!

Labor relations in the recent and distant past

The first of May: a day to enjoy spring or a day to celebrate labor?

A celebration of labor in the minds of most – a holiday/abstinence from work. The opportunity, for this reason, for the celebration of spring.

This year’s first of May was, of course, different from the rest. No gatherings or excursions to celebrate spring.

This spring, like the ones to follow: just as beautiful.

But what about labor relations?

Absolutely Different.

In May 1886 the labor unions in Chicago demanded eight hours of work and improved conditions. The slogan “eight hours of work, eight hours of rest, eight hours of sleep” summed up their demands. And all this in the traditional working model that was sufficiently responsive to the way the business is organized. In other words, in businesses that had a closed system of organization-structured according to the Ford production model.

There have been significant changes over the years. The concern for employees’ rights has increased. And so has the concern to ensure employment.

Labor relations are already adequately safeguarded. At the global, European, and of course national level. The result (among others): eight hours of work and a contract of employment. And, according to the classic model, at the employer’s premises.

The third industrial revolution in the late 20th century was characterized by the use of electronics and computer science. It was an important milestone. It marked the beginning of the departure from the classical systems of production and offering of services. It has dramatically expanded capabilities. It has created new, unprecedented, needs. Needs that, to some extent, resulted in the creation of new forms of employment-deviations from the traditional working model.

To meet these needs, more and more flexible forms of employment have been gradually utilized. The recent outbreak of the Covid-19 pandemic has pushed them into the foreground.

It has already been proven that their utilization (or their necessary application) is a means of business survival. For the continuation of their operation and, of course, for the rescue of jobs.

But what are, after all, the flexible forms of employment?

Flexible forms of employment are those that, while based on the model of a typical employment relationship, at least one parameter is different. These are also characterized by the term “informal employment relations”.

Their flexibility can be traced to individual aspects of the employment relationship. It is possible, for example, for this flexibility to regard:

(a) The time when (but also the place where) the work is provided.

These are the forms of flexible employment whose duration and distribution of working time go beyond the (normal) time limits of a full-time employee. Such forms of employment do not require a physical presence at the business’s premises. Work is organized in ways that take advantage of new possibilities. That satisfy new needs. Among them are the new, already formed, needs of the market. Of course, of the corresponding needs of the employees as well. We have already addressed typical cases of these forms of employment in our previous articles. Indicatively: part-time employment, rotational work, shifts, telework, standby contracts.

(b) The employment status.

According to the traditional model, employment contracts were concluded for an indefinite period. As time passed, fixed-term employment contracts are becoming more and more common. Furthermore: Employees whose (direct) employers are Temporary Work Agencies (TWA) provide their services to another (indirect) employer for a limited period of time in the form of temporary employment.

(c) Remuneration systems.

Flexibility can also affect the structure of employees’ wages and other benefits. The voluntary payments offered by the employer may be related to the productivity and results of the business.

(d) Employees’ labor and insurance rights.

Flexibility in the employment status of employees clearly affects their salaries, benefits, insurance coverage, pension rights, etc.

However, the development and dissemination of flexible forms of employment has been accompanied by specific problems, which require the modernization of the regulations concerning them. The problems, mainly associated with the insecurity of employees and the (given) legislative loopholes, have already mobilized the European Union. Its goal is to balance between flexibility and protection.

The past: Flexible forms of employment over time

Flexible forms of employment are gaining ground. However, they are not a (very) recent invention of the legislator. At least not all of them. In our country, the national legislator has been concerned with flexible forms of employment since 1939, when rotational work was first provided for. Part-time employment was legalized in 1990. Teleworking was introduced relatively recently: in 2010.

The implementation of flexible forms of employment was, initially, limited. They were brought in the spotlight due to the economic crisis of 2009. They were then (as well) used as a means of survival for businesses and job security.

Significant reform of Labor Law in the field of flexible forms of employment took place in 2010. Specifically, Law 3846/2010 addressed, among other things, issues of temporary and part-time employment, teleworking, working time. Among its objectives: (a) the provision of guarantees in all cases where the hitherto existing regulations on flexible forms of employment did not prevent the creation of insecurity, (b) effective treatment of non-compliance with the working conditions provided for by law, (c) reduction of inequalities in the treatment of those working with flexible forms of employment.

The recent, ten-year-long economic crisis has come to an end. The advantages of flexible forms of employment remain visible. Businesses have started making the most of them. This did not only happen in our country. According to a relatively recent (2019) survey by the International Workplace Group, 55% of businesses wanted to become more flexible, with immediate consequences, among others, for the forms of employment.

The turn of businesses towards more flexible forms of operation (and, of course, employment) was not meant to be gradual. The reason for the (largely) violent, specific, transition of the majority of businesses to flexible schemes was the escalation of the pandemic caused by coronavirus (SARS-CoV-2).

Present: Flexible forms of employment as means of saving employment relations from the pandemic

The escalation of the pandemic has created a new, unprecedented reality in the field of labor. Businesses whose operations were not suspended by public order were faced with a dramatic reduction in their revenues. The reduction in their productive activity was logically expected to lead to layoffs of redundant staff in order to reduce wage costs.

Therefore, it became necessary to take urgent measures, which on the one hand aim to protect employees and maintain their jobs, on the other hand to save business activity and the continuation of the operation of businesses, in the light of the protection of public health.

We have already attempted to decode these measures in our previous articles.

Among the measures taken to address the effects of the pandemic on workplaces (which we have already addressed), flexible forms of employment play a leading role. The specific forms (differentiated from the ones mentioned above) cover the special needs of businesses and employees created due to the pandemic. Particularly:

(a) Regarding the safe operation personnel

Article 9 of LD / 20.03.20 (as specified by No. 13564 / D1.4770 / 30.3.20-Government Gazzette, B ‘/ 1161 / 3.4.2020 MD), provided the possibility of the employer to appoint safe operation personnel. This temporary measure of flexible employment (which we analyzed in our previous article) is similar to the (unilaterally imposed) rotational work. What do they have in common? The alternation of working and non-working days.

However, the temporary measure of safe operation personnel has distinct application requirements.

In particular, this measure only applies to businesses that are (depending on the NACE Revision 2 classification of their business activity) among those affected by the pandemic. These businesses are entitled to implement the measure of safe operation personnel. This measure will cover at least 50% of the total staff of the business. In addition: each employee can be employed at least two (2) weeks per month, continuously or intermittently.

As for the obligations of employers, they owe salaries to the safe operation personnel corresponding to their employment. At the same time, however, they are obliged, for as long as they use the measure, to maintain the same jobs, that is, the same employees and on the same terms. Those who quit or those who retire are exempt from the above provision.

Relevant to this measure are the subsequently issued No. 13564 / D1.4770 / 30.3.20-Government Gazette, Β ‘/ 1161 / 3.4.2020 MD and 12998/232 / 23-3-2020 CMD (Government Gazette Β’ 1078 / 28-3-2020). However, there are still problems that we pointed out in our previous articles (Coronavirus and Businesses: The obligation to maintain jobs).

(b) With regard to the transfer of personnel to businesses within the same group

This measure, like that of safe operation personnel, aims to prevent redundancies. This measure offers flexibility to the employer. This flexibility regards the business in which, in the end, the employee provides their services, regardless of their (initial) employer. Therefore, the deviation from the traditional working relationship model.

If this measure is utilized (Article 10 LD / 20.03.20), the business affected by the pandemic or the business whose operation was prohibited or suspended is entitled to transfer its staff to another business of the Group to which it belongs. A condition is a relevant agreement between the two businesses involved. In addition, the businesses involved are required to maintain a total of the same number of employees as before the transfer. In this case, the clause excludes those who resigned and retired.

It should be noted that this measure, although newly introduced, had already been addressed by jurisprudence. The Supreme Court accepted the employment of an employee in other businesses of the same Group as possible. And this, regardless of which business of this Group is an employer (10/2018 CS). We have already addressed this issue in our previous article.

(c) Regarding remote work

The need for people to stay home for the protection of public health has highlighted the value of teleworking. We addressed the subject and its importance in our previous article. The points worth stressing are the following:

LD / 11.03.20 provided for the possibility for the employer to unilaterally determine “… that the work provided by the employee in the place  provided for by their individual employment contract, will be carried out with the system of remote work” (art. 4 par. 2 LD / 11.03.2020).

The majority of businesses is already taking advantage of the possibility of unilaterally imposing remote work. Teleworking, although temporarily detached from its voluntary nature, has emerged as the most appropriate measure to continue the operation of businesses and the provision of services by employees.

It should be noted here that in the case of teleworking, the employer is not charged with additional commitments (such as the obligation to maintain the same jobs). However, in this case, the issue of accident at work becomes worthy of attention for the employer. This is because, in the event of a work accident, the employer’s liability is not waived in the case of telework from home. Therefore, it is necessary for the employee to make a statement regarding the safety of the performance of their work from their home.

The future: Flexible forms of employment after the pandemic

It is a given that flexible forms of employment have, by some, been demonized. However, they did not appear “yesterday” for the first time. (We have also seen that a form of rotational work has been around for almost a century). Nor will they ever leave us. Quite the opposite.

Flexible forms of employment, regardless of the statute of limitations, are already a reality. Internationally for a long time. Nationally, very intensely, during the last two months.

Businesses, in order to survive, have focused on reducing their expenditure – flexible or other. The reduction of wage costs is of great importance. And, to a significant degree, it has been achieved by reducing employment. The legislator had already (even before the pandemic) provided several options to businesses. And because of the recent crisis, those options have expanded. And rightly so.

Utilizing flexible forms of employment has already created a new norm. A reality that is not expected to dissapear with the (not yet visible) end of the pandemic.

On the contrary:

Flexible forms of employment, with their now broader part, will help entrepreneurship. They will help tackle the new, rather profound, recession. In maintaining wage and other costs at lower levels. In the (further) modernization of the way businesses operate. In the modernization of labor relations. In their adaptation to current social, economic and technological data.

Flexible forms of employment will also help to secure jobs. The benefits they recently offered will in time be proven crucial for the national economy (among others). This just not only regard employees. Nor is it limited to national authorities. The European Union has already started heading towards the right direction – especially with regard to reduced working hour schemes.

The reduced work schedules and the SURE Program

Reduced work schedule schemes are very important in the world of flexible forms of employment. These schemes allow businesses with financial difficulties to temporarily reduce their employees’ working hours. Indicatively, regarding our country: part-time employment, shift work, readiness contracts, Safe Operations Personnel.

It is logical that these programs raise concerns about employees’ incomes and the insurance of a minimum (tolerable or desirable) standard of living. And it is logical that the employees are not the only ones burdened with these concerns. This issue is also troubling, of course for different reasons, the national and European authorities.

Because of these concerns, the European Commission has launched a new instrument. More specifically, it has provided temporary support for the mitigation of Unemployment Risks in an Emergency (SURE). SURE aims to protect jobs and employees affected by the coronavirus pandemic.

In fact, the procedures have already been launched so that the specific instrument can take the form of a Regulation.

SURE will provide a financial assistance of up to €100 billion in total. This assistance will be provided in the form of loans granted by the EU to the Member States on favorable terms. These loans are expected to help Member States cope with a possible sudden increase in public spending to maintain employment. More specifically, it is intended to help Member States cover costs directly related to the creation or expansion of national systems for reduced working hours and other similar measures established for the self-employed in response to the current coronavirus pandemic.

The reason for the introduction of this particular medium was the finding that there are many businesses that face significant difficulties because of the pandemic. In order to manage them they are forced, not infrequently, to temporarily suspend or significantly reduce their activity and the working hours of their employees. By avoiding unnecessary redundancies, systems that will reduce working hours can prevent the most serious and long-term negative consequences of a temporary shock to the economy and the labor market in the Member States. In this way, they contribute to the maintenance of household income and to the maintenance of productive capacity and human capital of enterprises and the economy as a whole.

SURE will provide additional EU support to Member States to finance their systems on a part-time basis. In this way, job protection is expected to be achieved and so is, ultimately, the support of the member states’ economies.

SURE, albeit temporary, aims to become part of the Commission’s overall strategy to protect citizens and mitigate the extremely negative socio-economic consequences of the pandemic.

In other words:

(a) The EU accepts the reduced working hours of employees as a means of managing the crisis on the part of businesses.

(b) The EU prioritizes reduced working hours (against redundancies) as a means of managing the crisis.

(c) The EU has already initiated procedures for the financing of Member States in order to make it possible for them to (further) finance reduced working hours programs in order to save jobs.

Some government announcements have already taken place regarding the use of the facilities offered by this program.

Instead of an epilogue

Flexible forms of employment are not the worst thing that could happen to us after the pandemic. Let’s not treat them with fear. Let’s not treat them with introversion. Let’s not treat them as a disaster.

Let’s turn our attention to technology and focus on our own skills. Let’s see it as a chance to move forward. Let’s act positively and be active. Let’s take advantage of the flexible forms of employment and the opportunities they create.

Could an executive, freelancer or entrepreneur consider not having a laptop? Not being able to use applications for online meetings? Not being able to remotely connect to their business?

And why should we deny part-time work, rotational work, safe operation personnel?

Can we, using logical arguments, react when the world seems to be coming to an end? Or even when a particular business is about to close? Or can anyone seriously argue that they prefer to stick to a full-time employment contract that is about to be terminated?

Let’s not forget, however, that in the end:

Globalization is not just about others. It’s not just about international business giants. Almost every employee can now provide their services anywhere in the world.

But also viewed from another point: Almost every employer can “buy” services from employees anywhere in Greece. Or / and the world.

This is the reality.

Ostriches have no place in it.

Stavros Koumentakis
Senior Partner

Disclaimer: the information provided in this article is not (and is not intended to) constitute legal advice. Legal advice can only be offered by a competent attorney and after the latter takes into consideration all the relevant to your case data that you will provide them with. See here for more details.

Coronavirus: the invisible (?) enemy of jobs (: dismissal prevention measures)

I. PREAMBLE

1. The pandemic COVID-19 is in full swing.

Its end is not, in any case, visible.

The global health crisis is, for all of us, unprecedented. It will inevitably lead the world economy to a recession. And, of course, the national economy as well.

The vast majority of businesses are experiencing the dramatic consequences of the pandemic. Entrepreneurs (and those with corresponding responsibilities) are looking (sometimes desperately) for ways to survive.

The most important challenge we all must face is to safeguard life and health.

Immediately after: the survival of the national economy, of the businesses. Last, unfortunately, in order: the survival of employment relations.

In our country, soon after the confirmation of the first cases, there has been significant turmoil in the labour market (one could more accurately call it panic).

2. The administrative measure of suspension of operation of specific businesses (: necessary to prevent the spread of the virus) consequently resulted in a large number of redundancies.

March is already showing a negative balance in the labour market. According to the government, layoffs exceeded 40.000 in the first two weeks of March. According to the opposition, 110.000. The numbers are dramatically high.

Stopping the phenomenon constitutes a national emergency. Legislative intervention has been necessary to achieve the halt. A Legislative Decree was issued on the 20.3.2020  (Government Gazette A 68 / 20.3.2020) –Emergency measures to address the consequences of the COVID-19 coronavirus spread, to support society and to ensure the smooth functioning of the market … This Decree introduces, inter alia, new regulations to employment relations. It introduces measures to prevent dismissals and suspension of employment relations.

3. The specific measures (preventing dismissals and suspension of employment relations) concern:

(a) Businesses whose operations have been temporarily prohibited.

(b) Businesses which operate in sectors that (according to the Ministry of Finance) are severely affected by the pandemic.

The above Legislative Decree has already been analysed in a previous article (: “Coronavirus and Business: The Second Decalogue For Businesses and Employment Relations“).

However, it is necessary to take a more careful look into saving as many jobs as possible.

For the benefit of the national economy and businesses. And, of course, for the benefit of the employees and the community as a whole.

II. THE MEASURES

1. Employment relations with businesses suspending their operation (by decision of a public authority)

(a) Suspension of operations

Enterprises operating in specific sectors, which have been placed under a temporary ban or have been suspended by decision of the Administrative Authority (e.g.- student tutoring centers, private schools, retail outlets).

The financial blow they suffer is unquestionable.

The first (reasonable) thought of those responsible was to mitigate the economic impact. The reduction of expenditure. Especially of the wage costs.

(b) The prohibition (and invalidity) of dismissals

In order to halt dismissals, businesses whose operation was suspended were prohibited by law to dismiss their employees.

The abovementioned (under I) Legislative Decree stated, in particular, that: “Businesses – employers who suspended their operation by order of a public authority, and for as long as the COVID-19 measures are in place, shall be obliged not to reduce their staff by termination of employment contracts ”(Art. 11 par.1(a)).

Nevertheless, in the case of non-compliance and termination of employment contracts (from the part of the business concerned), the invalidity of such is provided for (Article 11 par.1 (b)). The nullity of dismissals is retroactive. It, retroactively, covers those dismissals that have taken place from the 18^th of March.

(c) The “reward” to balance out the prohibition of dismissals

In return for the above (under b) prohibition of dismissals, the aforementioned companies are not required to pay wages at the time of suspension of their operation.

Their employees, on the other hand, are entitled to emergency financial assistance (provided for by the state) of € 800 (special purpose remuneration).

2. The operation of businesses with safe operation personnel

The measure providing for the safe operation personnel is another measure to prevent dismissals. It concerns (as per the Legislative Decree of 20.3.2020) all businesses. Information leaks from the Ministry of Labour imply that the Ministerial Decision that will provide for the details of implementation of this measure will limit its scope. Specifically: that it will only concern the businesses that are operating in the sectors that are on the Ministry’s list of the sectors affected. This measure will provide for fewer days (and therefore weeks) of employment per month, alternating between working days (or full weeks) and non-working days, at the decision of the employer. At its core, it is therefore similar to the measure of a unilaterally imposed rotational work. However, the conditions of the implementation of this measure laid down in the Decree (Article 9) significantly distinguish this measure from that of the unilaterally imposed rotational work.

In particular, the conditions for its implementation concern: (a) The minimum monthly employment of employees. (b) The minimum number of employees who may be subject to the measure. (c) The maximum duration of the measure.

Specifically:

(a) The employee who will work as Safe Operation Personnel shall be employed for a minimum of two (2) weeks per month. Continuously or intermittently.

(b) At least 50% of the staff of the business must be designated as safe operation personnel. Therefore, the business should employ the employees that have not been designated as safe operation personnel full time. The exact organization of work time can be determined on a weekly base.

(c) The implementation of the measure of operation of a business with safe operation personnel cannot be permanent. This measure can be implemented until 20.9.20, at the latest.

At the same time, the employer has two obligations.

The first concerns the declaration of the implementation of the measure on ERGANI. It must be declared at the end of each month.

The second obligation is of utmost importance. The employer who chooses to operate their business with safe operating personnel is required to retain their employees.

Details are expected to be determined by a decision of the Minister of Labour and Social Affairs.

3. The transfer of personnel to companies within the same group

It is an additional measure in the (national) effort to prevent redundancies.

Under the current legal framework, the company is entitled to transfer its staff to another company of the same Group (to which it belongs). The courts have already dealt with this issue, despite the measure being newly introduced. The Supreme Court accepted the possibility of employing employees in different companies in the same group. And that, no matter which company in the Group is the employer. We have already analysed this issue in a previous article (: employing employees in companies of the same group)

Article 10 of the Legislative Decree of 20.3.20 (expressly) provides for the possibility of transferring staff to companies within the same Group. This provision has limited application. It concerns, in particular:

(a) Companies affected by the Covid-19 pandemic

(b) Companies whose operation has been suspended by the competent authorities in response to the pandemic

The Legislative Decree imposes specific obligations on the companies concerned.

The first obligation is the existence of a written agreement between the companies.

The second requires the maintenance, in total, of the same number of employees as before the transfer.

Details are expected to be determined by the Ministerial Decisions to be issued.

4. Employment relations in businesses that are (significantly) affected by the pandemic

(a) Affected sectors and the regulation of employment relations

On March 20, the Ministry of Finance announced the classes of the NACE Revision 2 affected by the spread of coronavirus. The list is constantly expanding.

Although these businesses are allowed to operate, unfortunately, given the circumstances, they run at a low capacity. In order to avoid dismissals, as a result of the reduction of their business activity, the option to suspend part or all of their employment contracts was also provided to these businesses. Specifically:

(b) Suspension of employment contracts and related obligations of the employer

(i) The individual characteristics of the suspension of the employment contract

This is a measure which is introduced in the Greek legal order for the first time. It is similar to unpaid leave. However, during its implementation, it does not affect the acquired rights of employees (as this time seems to be taken into account, for example, when calculating the time of service and retirement). In this case, the maximum duration of the measure is one month. However, it can be extended (provided a relevant JMD is issued).

(ii) The option

Affected businesses have the option to choose whether or not to suspend (part or all of) their employment contracts. However, if they so choose, the termination of employment contracts is expressly prohibited. And that goes for all their staff.

(iii) The prohibition and invalidity of the redundancies

Nevertheless, in the case of non-compliance and termination of employment contracts (from the part of the business concerned), the invalidity of such is provided for

(iv) Maintaining jobs

In addition to prohibiting the termination of employment contracts for undertakings which opt for the suspension measure, there is an additional, quite important, obligation. The Decree provides that “… after the expiry of the suspension of the employment contracts, they are required to maintain the same number of jobs for a period equal to that of the suspension”. In other words: even if the aforementioned businesses fire an employee, they must hire another employee in its place. And this goes for as long as the suspension lasts and for a period equal to that, after the suspension expires.

Accordingly, in the event of an expiration of a fixed-term employment contract (and therefore of its automatic termination), there are two possibilities. Either its renewal will have to take place, or another employee has to be hired at the place of the one whose contract expired.

(v) Special purpose remuneration

Employees of companies that make use of the option to suspend employment contracts are also entitled to a special purpose remuneration.

According to the MD No. 13031 / D1.4551 (Government Gazette 994 / 23-3-2020), employers who declare to ERGANI employees whose contract is suspended, should state that their core business activity has been suspended (!). This is despite the fact that this requirement does not derive from the relevant Legislative Decree. We want to believe that this is, obviously, an unfortunately worded text.

III. What about the dismissals that have already taken place?

The validity of the dismissals that took place until 17/3/2020 is not affected. However, dismissed employees (or employees who resigned), within the period from 1 to 20 March, are entitled to the special purpose remuneration (article 11 par. 2B. (b) Decree of 20.3.20).

IV. Special purpose remuneration and employer obligations

(i) Special purpose remuneration and its characteristics

Suspension of business and suspension of employment creates a new reality in employment relations. For reasons of force majeure, no service is provided by employees. As a result, the salaries cannot be paid (by the employer). It was necessary to provide employees with emergency financial aid. This is what the “special purpose remuneration” is. It is of the amount of 800€ and it covers 45 days.

The cost of paying the above compensation is covered by the state budget. And so is the insurance coverage of employees (article 11 par.2B (f) Decree of 20.3.20).

It is also important to note that the special purpose remuneration cannot be seized and it is tax-free. Also: it is not offset against any debt.

(ii) The (related) obligations of employers

The employers must submit the Analytical Periodical Statements of their employees, whose contracts have been suspended. The cost of their full insurance coverage is calculated on their nominal wages.

In order for the employee to receive the special purpose remuneration, the employer must follow a specific procedure as provided for in the Legislative Decree (article. 11 par. 2.C. a, b, c, d) and the MD No. 13031 / D1.4551 (Government Gazette 994 / 23-3-2020).

In particular, the employer is required to submit an official declaration to ERGANI, mentioning the employees whose employment contracts are suspended: (a) either because of the prohibition of their operation, ordered by a public authority, (b) or because of the utilization of the measure of suspension of employment contracts by the affected business.

In addition, the employer is required to include in the official declaration those employees whose employment contracts have been terminated from 1 to 20.3.20. As already discussed, the provision of the Legislative Decree in this case concerns contracts terminated: (a) either following a complaint by the employer, (b) or because of the employee’s resignation.

The employer is obliged to notify the employee within the day of submission of the official declaration. The notification shall be on paper or electronically. It must, in any case, include the registration number of the relevant act on the ERGANI platform.

(iii) Violation of the employer’s obligations

Failure to submit the above official declaration by the employer does not have serious, damaging, consequences. In particular, an employer who fails to provide an official declaration will not enjoy the suspension measures of facilitations or instalments or partial payment facilities of any type of certified debt they may owe to the State.

V. In conclusion

The decade of the financial crisis brought a heavy blow to entrepreneurship.

Businesses are called upon to face a new crisis.

Probably deeper.

We hope it will be a short-term one.

Employment relations are being re-tested.

The state is doing, at least for now imperfectly, its duty. It protects employees to a significant extent. It is assisting some of the affected businesses.

The pandemic is inevitably linked to an economic downturn. We are already experiencing it. We hope it will also be short-lived.

The protection of employment relations (sooner or later) will decline. And it must. Let dismissals be the last measure employers will adopt. All the more mild measures continue to exist, uninterrupted.

Employers can always make other choices before deciding on making dismissals: (a) conversion of full-time to part-time employment contracts; (b) the agreement (or enforcement) of rotational work (or) the agreement (or enforcement) of suspension

And, of course, those discussed above.

The negative balance of employment in March will hopefully be a small (bitter) bracket.

For the benefit of the national economy and growth.

Stavros Koumentakis
Senior Partner

Disclaimer: the information provided in this article is not (and is not intended to) constitute legal advice. Legal advice can only be offered by a competent attorney and after the latter takes into consideration all the relevant to your case data that you will provide them with. See here for more details.

Teleworking: A Modern and, Under Conditions, Valuable Form of Work

I. Preamble

(1) Beginning of the 1st millennium BC: The galley appeared. It was mainly propelled with paddles. It was used until the early 19th century. We are all familiar with the (cinematic) images of the dozens of paddlers who, with their coordinated actions, were moving huge, for the time, ships.

All together. Simultaneously. Inside the gallery.

We can be relatively certain that none of the puddlers (: either they were free or slaves) would then think of offering their services remotely.

(2) Early 20th century AD: Henry Ford adopts an innovation at his factory in Detroit in 1914: the production line. The production line simultaneously employs a homogeneous workforce. The work consisted of individual simple and repetitive movements that served mass production.

All together. Simultaneously. Inside the factory.

We can, in this case, also be fairly certain that none of the employees at the Ford plant would even consider offering their services remotely.

(3) March 11, 2020: WHO declares the COVID-19 infection, caused by Coronavirus-2019 SARS-CoV-2, a pandemic. Businesses must continue to operate. Employees should not be at risk. (And they should not cause further dissemination of the virus). Ways for employees to remotely provide their services were sought. There was already the relevant experience. Teleworking is becoming widely known and widely used…

II. The Appearance of Labor Law and the Individual Forms of Labor

Industrialization has undoubtedly been the reason for the emergence of Labor Law. The Fordian model of production (seemingly) played a decisive role in its formation. (That is, the system that was adopted by the aforementioned Henry Ford).

The descriptions in the preamble of the present article is quite inconsistent with what is happening today. Industrial production seems to be rapidly replaced by service industries.

Flexible forms of work are steadily gaining ground over the traditional ‘full-time, part-time employment contract’. Full-time and/or part-time employment contracts are not uncommon. Nor are rotational work employment contracts.

The development of technology is more rapid by the day. New forms of work are introduced as technology evolves. Both employees and businesses are seriously concerned with those new forms. And of course so is the legal world. Outsourcing, networking, crowdsourcing and telecommuting are a reality. This particular reality cannot be ignored. On the contrary, we must utilize it. And now, because of the critical situation we are living in, we are urged to take advantage of it immediately.

 III. Coronavirus And Teleworking…

Telework has been at the forefront in recent days. In our country as well.

Legislative Decree of 11 March 2020 introduced “Urgent measures to counter the negative effects of the occurrence of COVID-19 coronavirus and the need to limit its spread”.

The Decree provides that: “The employer may decide that the work provided by an employee at the place of work as per their individual employment contract shall be carried out in accordance with the system of distance work.” In fact, the Decree provides the possibility of extending the time of application of the above extraordinary and provisional measure, “by joint decision of the Ministers of Finance, Labor and Social Affairs and Health” (Article 4 par. 2), after 10.04.2020.

Teleworking is part of the wider context of distance working. Part of it is teleworking at home. This way of working thus achieves the twofold purpose of: (i) The possibility of employees to stay at home. (ii) The continuation of the employment of the employee.

In emergency situations (such as the one we live in because of the coronavirus), teleworking achieves: the continuation of the employee’s job, ensuring the continued operation of the employer-business, the elimination (or at least, reduction) of both employer and employees’ financial loss.

IV. Teleworking And Its Individual Forms.

Teleworking can take the form of full-time or part-time employment. It utilizes IT and communications. It makes it possible for the employee to provide services at a location other than the location of their employer.

Teleworking comes in many forms. Its individual forms are (also) identified by the place the work is offered. Based on this criterion, the following forms of teleworking are encountered, inter alia:

(a) Home-Based Telework: As already mentioned above (under III), due to the emergency caused by the pandemic, this is the most appropriate way of providing work. We would even dare to add: it also is the most common one globally. This is the main and most widely used form of teleworking. It is seen as a development of traditional, home-based work. The teleworker, in this case, uses their home as their base for their work. Their home instead of their employer’s premises.

It is important to note, however, that the employer’s liability for an accident at work is not waived in the case of home-based teleworking. In this context, it is necessary for the employee to obtain a statement on the safety of their work from home. A relevant “Declaration” document should be signed by the employee and submitted to the employer.

(b) Mobile Teleworking: The teleworker does not, in this case, have a fixed working base – e.g. their house. They can be in a number of locations / establishments, which constitute the place where their work is performed (eg the provision by the employee-accountant of corresponding services to the premises of their employee’s [(accounting) firm] clients. This is a widely used form of teleworking in the US. It is already developing in our country.

(c) Telecentres: These are small workstations – premises with appropriate equipment to perform the necessary work. Telecentres are owned by the business-employer. They are smaller holdings, away from the employer’s central location and close to the workers’ residence. At telecentres, more teleworkers have the opportunity to offer their work.

(d) Functional Relocation: This regards whole sections of the business, which are detached from its headquarters. These sections are established separately. However, teleworkers have direct access to the company’s systems. They show a significant resemblance to telecentres. Their main difference, however, is the fact that telecentres can concern employees from different parts of the business. On the other hand, functional relocation relates to the relocation of an entire division (or entire divisions) of a business and to all employees of that division. For example, the Customer Service Department of a business can be functionally relocated. It is not uncommon for this department to be located at a place outside of the businesses headquarters.

(e) Telecottages: This form first appeared in the Scandinavian countries. Telecottages resemble telecentres. However, they do differ on an essential point. Teleworking sites are owned by local communities and not by a business, thus providing public access to computers. Their broader purpose is to educate residents of remote regions.

V. Advantages of Teleworking

There is no questions on the importance and positive effects of teleworking.

In times of crisis, such as the present one, the positive effects abound. Indicatively: for public health, for the economy and, of course, for business. But even under normal circumstanses, teleworking undoubtedly offers a multitude of advantages. These benefits apply to the employee, the employer, and even the community as a whole. In a nutshell:

(a) For the Employee: Teleworking helps employees organize their own working time. Protect their personal health. Save time and cost of moving to (and from) their workplace. It is an opportunity for people with serious family responsibilities or with health problems to (re)integrate into the labor market. It is also an important weapon for the (re)integration into the labor market of people with disabilities. In addition: for the removal of discrimination against them.

(b) For the employer: Teleworking is an important tool for reducing the cost of the business. In particular, the costs relating to the establishment and maintenance of the necessary facilities. Further, the employer, through teleworking, is expanding the number of its eligible employees. Their place of residence is no hindrance to teleworking. Also: absenteeism is not uncommon in the context of (regular) employment. Some of these are linked to objective reasons (eg strikes on public transport or mild illness). Such difficulties in teleworking do not constitute a reason for not providing work. The employer can also look forward to increased employee productivity as work is provided in the familiar environment of their home.

(c) For the community: Reducing employees’ mobility clearly has an environmental impact. In addition, teleworking can contribute to the development of remote areas. Urbanization for professional reasons is, of course, reduced through teleworking. Lastly: it protects public health.

VI. Cons of Teleworking

Teleworking does not, of course, have only advantages. Some of its disadvantages are:

(a) For the Employee: When the place of residence is the same as that of the workplace, the teleworker is, in principle, isolated from their colleagues. And, more broadly, from the community. Their professional life strongly interferes with their private life, as the relevant boundaries are broken. Also: the teleworker is (potentially) on a permanent basis available to their employer. The potential for collective organization and action of teleworkers is subsiding.

(b) For the Employer: When work is not provided at the employer’s premises, the employer loses significant control. The ability to monitor employees is limited to the result of their work. Also: business data, which the teleworker needs to use, is disseminated outside the secure, internal, business networks. Along with whichever risks this entails. Finally, the employer is obliged to support technical equipment in an indefinitely wide geographic scope.

VII. The Legal Status of Telecommunication

One would expect that there would be comprehensive legislation on teleworking. However, this is not the case. The relevant legislation is incomplete.

1. The EU provision for telework: The signing of a framework agreement

(a) European countries, attempting to adapt to developments, signed on 16.07.2002 a Framework Agreement on telework. This agreement sought to close the legislative gap for this type of work. Also, the (relative) modernization of labor law. This is because teleworking had already been evaluated as a means of modernizing labor. The purpose of this Framework Agreement was to reconcile the private and professional lives of teleworkers. Providing greater autonomy in their work.

However, the Framework Agreement on telework did not take the form of a Directive. Its implementation has been left to the initiative of each social partner, to the choices, procedures and specific practices of each country. Our country chose not to abstain. This European Framework Agreement was incorporated into the Greek legal order as an annex to the National General Collective Labor Agreement dated 12.04.2006.

(b) A definition of teleworking was included by the social partners in the provisions of the Framework Agreement. A rather wide one (not that this is bad)! According to this definition, “Telework is a form of organising and/or performing work, using information technology, in the context of an employment contract/relationship, where work, which could also be performed at the employers’ premises, is carried out away from those premises on a regular basis” (Article 2). It is clear that teleworking is accepted as an employment contract.

The member-states wanted to point out the voluntary nature of teleworking (Article 3). This contract may be concluded (at the beginning or at a later time of the employment relationship) only on a voluntary basis. And this, after the necessary information on how the work will be executed is first provided, in writing, to the teleworker.

(c) The above Framework Agreement contains, in addition, provisions relating to:

1. Equalizing and safeguarding the rights of teleworkers with those of comparable workers. (Comparable workers among those who work within the premises of the employer-company – Article 4). Also, ensuring equal professional opportunities between the two groups of workers concerned (Article 10).
2. Protecting business data. The employer must provide the necessary, relevant, updates to the teleworker. Indicatively, information on restrictions on the use of the Internet, equipment and IT tools. Also on penalties for non-compliance (Article 5).

iii. Protecting employees’ privacy and personal data (Article 6).

1. The employer’s obligation to provide, at their own expense, appropriate technical support to the teleworker. The obligation of the teleworker to take care of the equipment provided by the employer (Article 7). Provision of appropriate training in the use of the equipment provided (Article 10).
2. Protecting the health and occupational safety of the teleworker (Article 8).
3. The autonomy of the teleworker to determine the organization of their working time within the framework of the applicable laws, collective agreements and working regulations of the company concerned (Article 9).

vii. Ensuring that the employer takes measures to avoid the isolation of their staff (Article 9).

viii. Ensuring the collective rights and collective action of teleworkers (Article 11).

2. National legislation

(a) The presumption of employment

In our country, legislative reference to teleworking is found in Law 2639/1998. Article 1 of that law is entitled: ‘Special forms of employment’. It states that: ‘The agreement between the employer and the person employed for the provision of services or work for a fixed or indefinite period, especially when relating to job-processing contracts, teleworking, home employment, shall be presumed to conceal a contract of employment, provided that work is provided by the person employer themselves, exclusively or primarily to the same employer for nine (9) consecutive months’.

(b) The independent regulation on teleworking

Teleworking has become a separate type of national legislation, as a form of employment, by Article 5 of Law 3846/2010. The national legislator has attempted to specify some of the provisions of the European Framework Agreement.

As regards the obligation of the employer to inform the employee, it was stipulated that: “When the employer draws up a teleworking contract, they shall be obliged to provide the employee, in writing, with all information relating to the performance of the work within eight (8) days” (duties, remuneration, hours, cost of equipment and cost of repair if damaged by the employer, etc.). In fact, the legislator also made an innovation, stating that “if the contract contains a standby clause, the time limits and deadlines for the employee’s response are set.” (Standby contracts have already been addressed in our previous article).

The legislator acknowledged the difficulties in transitioning from common work to teleworking. It recognized, in this context, the right of withdrawal for both the employee and the employer. It offered a three month adjustment period. It granted both of them the right to return to the previous employment status within that quarter, with a 15-day deadline.

However, the national legislature imposed two more obligations on the employer: i. The obligation to bear any associated costs of the employee (in particular relating to telecommunications) and, in addition, ii. The obligation of written information of the teleworker, within 2 months of the conclusion of the employment contract, of the latter’s representatives. That is, the employer must provide the teleworker with the contact details of those who represent the labor rights of the staff within the company. (This is in order to provide additional safeguards for teleworkers’ union rights).

Latest national legislation referring to teleworking is the very recent Legislative Decree of 11.3.2020 (above under III). This Legislative Decree, while not specifying the content of teleworking, nevertheless highlights its value and usefulness.

VIII. Telework And Employment

For the application of the (protective) provisions of labor legislation on telework, an employment contract is required. Employment-related (traditional) employment theories and related criteria have been developed in the context of the ‘normal work’ regime. Upcoming forms of employment – such as teleworking – could not have be taken into account. The relevant legal provisions in this case are almost inapplicable.

The place, the way, and especially the working time, are de facto and, to a significant degree, decided by the teleworker. The prevailing theory of dependency seems to be waning. The managerial right of the employer seems insufficient (criterion) to classify telework provided as employment.

On the contrary, business risk appears as a safer criterion. In the event that the employer bears the business risk, telework is a form of employment. If the person offering their services bears it, then we would be safe to assume the latter is self-employed. Of course, in this case, the provisions of labor law will not apply.

The lack of adherence to obsolete perceptions is also necessary in this case. It is also necessary to understand developments and adapt Labor Law (as well) to them.

 IX. In Conclusion

It is necessary to detach from perceptions that go back three thousand years or more (the case of galley rowers, for example). Even from perceptions of the past hundred years (eg the Fordian model of production).

Developments are fast. We cannot ignore them.

Teleworking offers, as a form of employment, significant opportunities for employees and employers. (Even in a pandemic environment from the COVID-19 infection). In countries of the European Union (and / or abroad), this particular, flexible, form of employment is already booming.

In order to further utilize this institution in our country, concerns and reservations must be removed. Safeguarding the interests of stakeholders (: employee and employer) will help in this regard. And so will the proper application of teleworking.

Adopting an adequate regulatory framework seems to be a necessity.

It must be taken for granted that removing legal uncertainty will help to remove existing rigitness.

In development as well.

Stavros Koumentakis
Senior Partner

Disclaimer: the information provided in this article is not (and is not intended to) constitute legal advice. Legal advice can only be offered by a competent attorney and after the latter takes into consideration all the relevant to your case data that you will provide them with. See here for more details.