Compulsory time recording in Germany - Our experts have the answers

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A time recording system is an important tool that helps companies to comply with working time laws and regulations. Since the decision of the Federal Labor Court in Germany, attendance and absences must be recorded. However, the introduction of a time recording system also raises a number of questions. Our experts have compiled some of these questions to help you get started.

Question: On September 13, 2022, the Federal Labor Court (BAG) made a far-reaching decision regarding the obligation to record working hours in Germany. What can be said about it in summary and what impact does it have on German companies?

Answer: The Federal Labor Court ruled on September 13 2022 that the entire working time of employees must also be recorded in Germany. According to Section 3 (2) no. 1 of the German Occupational Health and Safety Act (ArbSchG), employers are obliged - subject to an interpretation in line with EU law - to introduce a system with which the time worked can be recorded (BAG - 1 ABR 22/21).

In doing so, the BAG refers to a ruling of the European Court of Justice (ECJ) of May 14 2019, which concerned the interpretation of the Working Time Directive. According to the BAG decision, the ECJ ruling must already be observed by employers in Germany due to the Occupational Health and Safety Act. (see Source)

The BAG ruling thus confirms that the obligation to record working hours is already applicable law in Germany today, although the Working Hours Act has not yet been amended accordingly. If companies violate the obligation to record working hours, the legislator can demand improvements or, in more serious cases, impose fines.

From this point of view, there is "danger in delay", so to speak, for companies that do not keep time records. We advise these companies to start recording time immediately.

Question: The introduction of a time recording system is sometimes viewed critically and characterized in the media with the catchphrase "return to the time clock". Are there any advantages for the employee/employer if a modern time management tool is introduced? 

Answer: There are advantages for both sides. It is important to recognize that there are usually different groups in a company, workers, employees, field staff, employees who work remotely, employees with PC workstations, employees without PC workstations, etc. In order for the benefits to be realized, it is important that all these groups are taken into account and that the time recording tool is flexible and adaptable.

For employers, I see significant advantages in three areas: Legal protection: By recording working hours and the associated concepts, e.g. digital confirmation of monthly hours worked by both parties or audit security in the event of changes to bookings, you have a solid basis in the event of disputes.

Rest periods, maximum working hours and other elements of employee protection can be monitored on an ongoing basis and immediate action can be taken if necessary. However, keywords such as "Did the accident at work take place during the lunch break or working hours" are also covered by the recording of working hours.

Reduction of administrative effort throughout the company and thus saving time and money: There are statistics that say that if you switch from a paper-based vacation request to a digital solution, you save up to 30 minutes per request. For companies with 200 employees and 3 vacation requests per employee per year, this alone represents a time saving of 300 hours per year.

However, in my opinion, another point is much more decisive - the provision of information - keyword employee self-service portal.

The biggest problem for companies that use Excel or paper is keeping the data up to date and making it available.

Questions such as - What is my vacation balance?, When will I be paid my business trip allowances?, I need my social security registration, can you send it to me?, Who is in the home office and when? .... occur frequently and are usually resolved through inefficient communication by sending emails back and forth.

Thanks to an employee self-service portal, employees can access their data themselves at any time and this data is up to date 100%. This saves a considerable amount of time in the HR department.

Increasing the attractiveness of the company - keyword "New Work": Qualified employees are in high demand. Demographic developments will significantly increase this effect. The demands of employees are becoming increasingly important.

One requirement is flexible working arrangements, e.g. working from home or part-time jobs with flexible working days.

Here are some key points why digital time recording is essential for both points:
Home office planning - When is who in the home office? Differentiating between working time and free time at home.

When do I work this week? How many hours did I work this week? Easy administration of flexible time models

Advantages for employees: Reduction of administrative effort - I think in 2022 you can say with a clear conscience that no employee will be happy with submitting a vacation request on paper. It takes time and distracts from the actual work. Furthermore, applications can be submitted regardless of time or place. A quick example from me personally: Imagine you are sitting with your friends and decide to go on vacation together next year. Within 2 minutes I can see whether my colleagues have already applied for vacation during this time and if not, I can fix my vacation directly here.

Transparency & compliance with the legal framework: Let's say you're sitting at dinner with your family. Suddenly the phone rings and one of your colleagues calls you because there is an urgent problem. At the same time, however, another member of your team is working who could also solve the problem. Without a modern time management system, such situations will occur again and again, as the coordination of a team and the current attendance status can never be reliably determined. 

As a manager, you are also responsible for taking proactive action in the event of excessive workloads or rest periods. These issues can only be mapped using a time management system.

Higher motivation : All current studies show that Employee Self Service (ESS) has a positive effect on employee motivation and positively influences the employee experience, i.e. the perceived appreciation that the company shows towards the employee. In addition to working hours and absences, our employee portal (ESS) can also be used to process topics such as digital salary statements and travel expense reports. This means that the employee always has a complete overview and can access all relevant information at any time without having to send an email to the HR department.

Question: Workflow has implemented numerous time management projects over the last 22 years. In your experience, what hurdles can companies face during the changeover and how can these challenges be overcome in the best possible way?

Answer: An important point when it comes to time recording is that the use of the software affects every single employee in the company. You introduce a new sales software, it affects 5 employees - you introduce a new accounting software - it affects 3 employees - you introduce a new time recording system - it potentially affects all employees in the company.

To ensure acceptance and a smooth changeover, it is important to test the software well before commissioning and to introduce a system that is as easy to use as possible, so that your employees can find their way around without a great deal of training.

A second point is internal project communication: it is important to inform everyone involved at an early stage and, for example, to involve the works council, if there is one, in the project. The boost for a successful project is when all relevant information is communicated to employees in good time and the benefits of the new software are also sold internally.

Last but not least, due to different collective agreements, company agreements or even individual agreements, there are often company-specific requirements that off-the-shelf software solutions are often unable to implement. This is where our greatest competitive advantage comes into play: our software is already preconfigured with useful standard features, but allows highly flexible customization to your needs! This means that you do not invest in a tool that you then have to replace after a year, for example, because a new requirement that suddenly arises cannot be implemented.

Question: What different forms of working time recording are there and how does a company find the right variant for each individual case?

Answer: Before you go into the form, you should ask yourself which employees in my company should record times and which employees are exempt.

For example, there is usually no obligation to record working hours accurately for managers or field staff. We have our own concepts for these employees.

There are three options for employees who need to record their working times accurately:

• Mobile recording via app (smartphone, tablet, etc.)
• Recording via PC
• Recording via time recording hardware.

In our experience, most companies use a mix of all three methods.
Employees in the office book via PC, employees in the home office or on business trips via smartphone, for employees without a PC workstation and cell phone, the time recording hardware is best suited.

Question: In your opinion, what is the best way for companies to proceed?

Answer: From our point of view, "danger is imminent" and we recommend that you start immediately with the introduction of a time management system. As a first step, it is important to determine your requirements and at least draw up a checklist for potential suppliers. This checklist should include topics such as data protection, requirements from a time recording perspective and, without fail, a test of the software. We advise our customers and are also happy to provide our checklists and project plans to ensure that the time recording system is introduced as quickly and smoothly as possible. You can draw on the wealth of experience of our system consultants. We also offer all interested parties a comprehensive free consultation with the aim of providing the most suitable offer possible, based on a tried and tested implementation concept.

Question: How long does it take for an electronic time recording system to be fully operational?

Answer: This depends heavily on the size and number of different employee groups.

As a rule, project implementation takes 2-3 months, including a one-month test phase.

However, this only applies to our cloud version Personalwolke. It already contains useful standards. The configuration for 80% is already complete at the start of the project and the only thing left to do is fine-tune it and incorporate the customer's wishes.

Question: There are many companies that are currently still using on-premise solutions. Why should these companies switch to the cloud?

A simple answer would be the cost-benefit ratio. Our cloud version is already preconfigured to a reasonable standard. This means that time recording is already set up for 80% at the start of the project and you can concentrate on the fine adjustments and the customer's wishes. Furthermore, the company does not have to operate and maintain its own servers and therefore does not need IT specialists. All in all, this saves a lot of money.

On-premise advocates usually bring up data protection and data security as their first argument. However, I cannot understand this argument for our Personal Cloud product.

The data is stored in one of the most secure data centers in Austria. To get directly to the servers, there are several security concepts, e.g. biometric recognition. Many companies do not have the possibility to implement such a strict concept. The servers are often behind a locked door - if you have the key, you are inside.

Another argument in favor of data security in our cloud version is the regular implementation of updates and thus the closing of security gaps.

Question: To what extent does the works council have an influence on the introduction of working time recording?

Answer:

If there is no statutory or collectively agreed regulation, the works council has a right of co-determination in accordance with §87 BetrVG (https://www.gesetze-im-internet.de/betrvg/__87.html) and can influence the form in which working time records are kept in the company. However, the BAG ruling makes it clear that the works council has no influence on the introduction of working time recording, as this is mandatory anyway.

Question: Can the employer require the employee to participate in the recording of working hours?

Answer: According to the framework regulation of Section 3 (2) No. 1 ArbSchG, employers are (see BAG March 18, 2014 - 1 ABR 73/12 - para. 23, BAGE 147, 306) are obliged to set up a system to record the beginning and end and thus the duration of working hours, including overtime, of the employees in their joint operation. They therefore have an objective legal obligation to act. It can be directly deduced from this that employees are obliged to record their working hours and that an employer can insist on this.

Question: In many German companies, no time records are kept under the concept of trust-based working hours. Is this still possible or under what conditions can trust-based working time be continued? 

Answer: According to the Federal Labor Court, companies in Germany are already obliged to keep time records. In our opinion, "trust-based working time" in the sense of negative time recording will therefore no longer be permissible. However, a similar effect can be achieved with a modern time management system in conjunction with a flexitime model, giving employees a high degree of personal responsibility while at the same time complying with the legal framework.

Question: What impact does the obligation to keep records have on New Work models (e.g. home office, remote, 4-day week, etc.)?

Answer: A big one - here, too, I would like to refer to the advantage described in question 2.

We firmly believe that the problems of remote working, working from home and flexible working hours can only be solved with the introduction of time recording.