Lange v Georg Schunemann [2001] IRLR 244
Overtime is a thorny issue - both whether a worker is acting in breach of contract by refusing to work overtime and from the opposite perspective whether an employer is contractually obliged to offer and pay for overtime worked. Often there is a lack of clarity on the position in workers' contracts and statement of terms of employment.
The issue has now been considered by the European Court of Justice in Lange v Georg Schunemann under an employer's obligations under the Proof of Employment Relationship Directive (No 91/533). The requirements of this little publicised Directive are set out in UK law in Section 1 of the Employment Rights Act 1996, statement of particulars of employment. Under Art 2 (1) of the Directive an employer is obliged to notify an employee of the "essential aspects of the contract or employment relationship" including, under Article 2 (2) (i) "the length of the employee's working day or week".
In the UK this is transposed as "any terms and conditions relating to hours of work...including normal working hours".
It would seem that in Germany as well as the UK there is often confusion about whether overtime is compulsory and the question referred to the ECJ was whether an employer must inform employees of overtime obligations under Article 2(2) of the Directive. The ECJ was also asked to rule on the consequences of a failure to do so by the employer. On the facts in this case the employee, Mr Lange had refused to work overtime and had been dismissed as a consequence.
The ECJ considered that overtime was an essential element of an employment contract and should therefore be notified to employees in writing. However, where an essential element has not been mentioned or has been mentioned but with insufficient precision then it is up to the national courts to apply their rules of evidence when determining the content of the employment relationship.
This decision is helpful in that employers should now include overtime obligations routinely as part of their Section 1 duties, but the refusal of the ECJ to hold that notifying the terms to an employee is necessary for the employer to rely on them is disappointing. The judgment will bring little comfort to the large number of employees who do not have a written statement of terms despite the requirement under s1 of the Employment Rights Act (ERA) 1996 let alone a written contract.
It means that there is no change to the tortuous process of analysing the contractual position relying on express as well as implied terms to determine whether overtime is compulsory in any particular case and it may therefore be left to employees to apply to an Employment Tribunal to seek a declaration of what their contractual terms are under s11 of the ERA 1996 before refusing to work overtime.