I. Background

Since 1995, employers have been obliged to confirm the essential conditions of the employment relationship to the employee in writing. However, the law had little significance in practice, since the employers were obliged to do so, but the Documentation Act did not provide for any sanctions for non-compliance with these obligations. In the worst case, therefore, an employer was threatened with having to fulfill the obligation later if the employee made a claim against him. With the Working Condition Directive, the European Union has obliged all member states to introduce a certain minimum standard in this respect. The Federal Republic of Germany has complied with this requirement by amending the Documentation Act. Compared to the previous Documentation Act, it contains numerous new provisions that must be recorded in writing, as well as requirements regarding the form and timing of the confirmation and the introduction of a fine to be borne by the employer in case of non-compliance with the requirements.

II. Additional contents

Under the previous legal situation, the key points of the employment relationship (name and addresses of the parties, commencement and duration of the employment relationship, description of the activity, place and time of work, remuneration) had to be confirmed. The new version has significantly expanded these contents as follows:

• Duration of trial periods
• Remuneration of overtime work
• Detailed description of the components of the remuneration
• Rest breaks/rest periods
• Shift work, shift system, shift rhythm and requirements for alteration
• On-call work including details
• Ordering overtime work and its preconditions
• Duration of leave
• Entitlement to further professional training
• Name and address of a company pension scheme provider
• Procedure for terminations, requirement of written form, notice periods and period for bringing an action for protection against dismissal
• Reference to applicable collective bargaining agreements and company agreements.

Some of these points are regularly covered in the usual sample contracts. However, in the vast majority of cases, the sample contracts do not contain sufficient information on rest breaks/rest periods, shift work, on-call work, conditions for ordering overtime, names of the pension providers, procedures for terminations and applicable collective regulations. From 1 August 2022, all employers are therefore advised to check and supplement their sample contracts before they are used to enter into new employment contracts.

III. Form of documentation

Like in the past, the Documentation Act does not require the conclusion of written employment contracts. Instead, it stipulates that the employer is obliged to provide written confirmation of the employment conditions to the employee. This confirmation may be replaced by an employment contract concluded in writing by the employer. The Working Conditions Directive expressly provides that the confirmation or the conclusion of the employment contract may also be made in digital form. Unfortunately, this has not been implemented by the German legislator, who has expressly stipulated a written form. In order to properly fulfill the obligations, the employer must therefore hand over to the employee either a confirmation of the working conditions signed by the employer in the original form or an employment contract signed by the employer in the original form. As a result, unnecessary problems with concluding contracts are to be expected. It is to be hoped that the legislator will make an improvement in this respect in the future.

IV. New contracts / subsequent changes / old contracts

In case of a new employment relationship, the employer is obliged to hand over a written confirmation or a written employment contract to the employee on the first working day at the latest.
The employee shall be notified in writing of any subsequent amendment to the material terms of the contract no later than on the day on which such amendment becomes effective. This does not apply in the case of a change in the statutory provisions, collective bargaining agreements, company or service agreements applicable to the employment relationship. A system should therefore be introduced to ensure such written confirmation of changes.
In case of old contracts, a confirmation must be handed over to the employees at their request no later than on the seventh day after receipt of the request; however, for certain contents (duration of leave, entitlement to further professional training, name and address of a company pension fund, procedure for terminations and reference to applicable collective bargaining agreements and company agreements), handover within one month is sufficient. The employer can therefore wait and see whether the employees request such written confirmation or proactively provide all employees with such confirmation without requesting it.

V. Sanctions

The new version of the Documentation Act now stipulates that non-compliance with the above obligations can be punished with a fine of up to EUR 2,000. It is therefore advisable to comply with the obligations.