On September 26, 2024, the Bundestag adopted the Federal Government's draft. The Bundesrat also approved it on October 18, 2024. The law was promulgated in the Federal Law Gazette on October 29, 2024. Most of the provisions of the Bureaucracy Relief Act will therefore come into force on January 1, 2025.[2] The Bureaucracy Reduction Act also provides some welcome relief for employers in the area of employment law. We would like to briefly highlight these below.
1. evidence act
The Evidence Act obliges employers to record the essential contractual terms of the employment relationship in writing within certain deadlines, sign the record and hand it over to the employee. One annoyance to date is that the evidence must be provided in writing and evidence in electronic form is excluded.[3] The written form requirement was already heavily criticized when the reformed Evidence Act came into force in August 2022 and was seen as a "relic from the Stone Age".
To comply with the written form requirement, the employer must provide the employee with a hand-signed document. As proof is usually provided by means of the employment contract, this means that the employee must be given a paper employment contract signed by hand by the employer, even though the employment contract is not subject to any formal requirements. The same applies to all subsequent changes to key contractual conditions (e.g. salary increases). This often poses logistical difficulties, especially for multinational employers in cross-border situations where, for example, the employer's HR department, the person authorized to sign the employment contract and the employee are located in different countries.
From January 1, 2025, it is now sufficient for the minutes to be drawn up in text form and transmitted electronically, whereby the employer must request the employee to provide proof of receipt with the transmission. With the replacement of the written form by the text form, proof can also be provided digitally without further ado in future. However, if the employee expressly requests written proof of the working conditions, the employer must continue to provide the information in writing.
The formal simplification described above does not apply to employees who are employed in a sector or branch of the economy specified in Section 2a (1) of the Act to Combat Clandestine Employment. These include the construction, catering, accommodation, freight forwarding, transportation and associated logistics industries, the meat industry and the security industry. The background to this restriction is that the legislator considers it necessary to maintain the written form in these sectors in order to protect employees.
2 Temporary Employment Act
In the area of temporary employment, the written form requirement between hirers and lenders that has existed to date for temporary employment contracts will be abolished. From January 1, 2025, the text form will also be sufficient here. However, the other requirements of the Temporary Employment Act for temporary employment contracts remain unaffected. These include, in particular, the obligation to expressly designate the contract as "temporary employment" (so-called identification obligation) and to specifically determine the person of the temporary worker before the assignment (so-called concretization obligation). Furthermore, the temporary employment agency must declare in the temporary employment contract that it is in possession of a temporary employment permit. The employer must continue to submit this declaration by the hirer to the works council when initiating proceedings pursuant to Section 99 BetrVG. In future, however, it will be sufficient for the lender's declaration submitted to the works council to be in text form.
3. trade regulations
According to the Industrial Code, employment references must currently be in writing. From January 1, 2025, electronic form (Section 126a BGB) will also be sufficient with the employee's consent. In our opinion, this should not lead to any significant simplification in practice. The electronic form requires a qualified electronic signature within the meaning of Art. 3 No. 12 of the eIDAS Regulation,[4] which is not yet widely used in practice. A simple signature, e.g. via Docusign, does not fulfill the requirement of a qualified electronic signature. The question arises as to whether a simple text form requirement would not have been sufficient here too, as most application procedures are carried out digitally today anyway. For reasons of legal certainty and verifiability, however, there are also good arguments in favor of prescribing a stricter form than text form.
4 Working Hours Act, Youth Employment Protection Act
Employers are currently obliged to physically display or hand out a copy of the Working Hours Act, the legal regulations applicable to the company based on the Working Hours Act and the collective agreements applicable to the company as well as works and service agreements in the company for inspection. If the employer employs young people, the same applies to the Youth Employment Protection Act and to information on working hours and breaks. From January 1, 2025, it will be sufficient if the aforementioned documents are made available via the usual information and communication technologies in the company or office, such as the intranet.
5 Federal Parental Allowance and Parental Leave Act, Caregiver Leave Act, Family Caregiver Leave Act
Employees on parental leave are entitled to part-time work under the conditions of § 15 Para. 7 BEEG. Among other things, the employer must have been notified in good time (seven or 13 weeks before the start of the desired part-time work). Until now, this request for a reduction had to be made in writing. From January 1, 2025, it will be sufficient if the application is made in text form. If the employer wishes to reject the part-time application, this no longer has to be in writing either. Text form is also sufficient here. In future, applications from employees for care leave or family care leave will also only have to be made in text form.
6 Social Code VI
Simply reaching the standard retirement age does not automatically lead to the termination of the employment relationship. Employment contracts therefore regularly (still) provide for the employment relationship to end when the employee reaches the standard retirement age for pension insurance. This is a fixed-term employment relationship, which means that the written form must be observed for this fixed-term contract to be effective (Section 14 (4) TzBfG). From January 1, 2025, the text form will also be sufficient. However, it is questionable how to deal with employment contracts that do not comply with the written form requirement, which contain such a clause and were concluded before January 1, 2025.
7 Conclusion
Despite the welcome simplification of formal requirements, particularly for employers, the legislator has certainly not achieved a major success with the Bureaucracy Relief Act. For example, the written form requirements for notices of termination, fixed-term contracts and works agreements, which are extremely relevant in practice, remain unchanged, although the question arises as to the extent to which these are still up to date. Various employment laws, such as the Works Constitution Act, are still significantly under-digitalized despite the changes made in the course of the coronavirus pandemic (e.g. through the Betriebsrätemodernisierungsgesetz). It remains to be seen whether and when the legislator will set out to make employment laws fit for the digital working world of the 21st century.
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[1] Fourth Act to Reduce Bureaucracy for Citizens, Business and the Administration (Fourth Bureaucracy Reduction Act), Federal Law Gazette 2024 I No. 323 of October 29, 2024, available at: www.recht.bund.de/bgbl/1/2024/323/regelungstext.pdf
[2] Cf. Art. 74 para. 1 of the Bureaucracy Relief Act.
[3] Violation of this formal requirement constitutes an administrative offense punishable by a fine of up to EUR 2,000.00.
[4] Regulation (EU) No. 910/2014.
