New Court Ruling Makes Timekeeping Mandatory for All EU Companies

On May 14th, the European Court of Justice (ECJ) ruled that companies operating in the EU must set up a system that tracks and records the duration of time worked each day by each worker.

“The (EU) Member States must require employers to set up an objective, reliable and accessible system enabling the duration of time worked each day by each worker to be measured. Each country will be free to define how to implement such a system”, the ECJ said in a statement.

The Case

This decision comes as a result of a lawsuit brought against Deutsche Bank by Federación de Servicios de Comisiones Obreras (CCOO), a Spanish trade union.

According to the trade union, Spain’s lax timekeeping laws did not require detailed recordkeeping of the hours worked by employees, which led to Deutsche Bank underreporting the hours and underpaying for overtime. The CCOO argued that this violated EU labor law set out by the EU Working Time Directive. The Court of Justice, the highest court in the EU, agreed with the challenge.

Business Impact

With the ruling delivered, EU countries will have to work out their own specific arrangements for enforcing the new law, with considerations for “the particular characteristics of each sector” and other factors such as company size.

Spain itself has already moved to bolster its timekeeping requirements with new rules requiring all companies, big and small, to keep records of employees’ daily working hours for at least four years.

One solution that addresses this new requirement is Mihi,  a cloud-based software which provides time and attendance, vacation, leave management, and benefits administration services for companies with a global workforce. It automates the collection of detailed work-time data for hourly, salaried, or contingent employees and is designed to be compliant with EU work-time regulations.

The software addressed all Human Capital Management (HCM) needs globally while lowering compliance risk:

  • It automatically applies labor, pay, and timekeeping requirements – both statutory and non-statutory – at country, state, and provincial levels
  • This centralized policy management means you’re audit-ready at all times, in all your countries of operation
  • Real-time updates and alerts allow managers to monitor compliance and avoid undue overtime
  • Employees get greater transparency with easy online access to clock in/clock out functionality, timesheets, and visibility into their time & attendance data
  • Preset approval workflows ensure quick responses and resolutions, creating a more efficient, productive workforce
  • It is localized in 15 languages and is GDPR compliant

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