CJEU decision fundamentally changes concept of reference periods for determining average working time

The Court of Justice of the EU recently issued a judgment that will most likely affect most Czech (and other) employers. The decision fundamentally changes the approach to reference periods used for monitoring overtime work or unevenly distributed working hours: they should be viewed as rolling ones rather than fixed ones.

The EU directive concerning certain aspects of the organisation of working time stipulates the maximum average working time including overtime work within seven days. At the same time, it stipulates the maximum length of the reference period over which the observance of the limit is to be assessed. Yet, the directive does not stipulate whether these reference periods are to be defined by fixed dates, or whether they have to be rolling, i.e. that their beginning and end would change continuously in the course of the time.

The Czech Labour Code also uses reference periods, for instance to monitor the limits of overtime work or average weekly working time for unevenly distributed working hours. In both cases, the reference period may be up to 26 weeks while collective bargaining agreements may extend it up to 52 weeks. These reference periods have been understood as fixed ones, meaning that employers would determine the beginning and end of the reference period (for instance as a calendar half-year), and only monitor the observance of the limits within these time intervals, not within any notional period of 26 weeks.

A similar working hour regulation applies under French Law. Hence, it was French legislation which the Court of Justice of the EU reviewed for compliance with EU law. The key question was whether the directive is to be interpreted as prescribing that the reference periods for the purpose of calculating average working time be rolling ones, or whether member states may allow the determination of reference periods by fixed dates.

The Court of Justice first referred to the objective of the directive, which is to protect the health and safety of workers. The court then noted that while the fixed reference periods themselves comply with this objective, they may lead to situations in which the objective of protecting the health and safety of workers may not be met, as they allow for cumulating a large number of hours during a shorter time interval. The court thus concluded that the maximum average weekly working time must be observed within any notional reference period, not just within periods defined by fixed dates. The court, however, forgot to stipulate at what time intervals these rolling reference periods should be moved – we may assume that it meant by individual weeks.

This means that in the future it will not suffice for employers to calculate the average for the fixed reference period, but they will have to make sure that the maximum working time is observed in each individual week. The strict observance of the new rules may mean an enormous administrative burden for employers, and even major operation disruptions for many of them.

Although the verdict was issued in a French case, Czech courts should follow the CJEU’s judgment as well. Only time will tell whether they will indeed respond to the new case law or whether the Czech legislation will be amended accordingly. We may but hope that in time, the CJEU itself will loosen this extremely strict interpretation under which any averaging of weekly working hours over reference periods loses any sense.