Agreements for variable hours will soon become void
On June 15, an amendment to the Employment Contracts Act will come into force, which will nullify the regulation of variable hour agreements. This means that from that date, it will no longer be allowed to enter into new variable hour agreements, and previously concluded agreements will only be valid until June 14 of this year.
Since December 15, 2021, larger retail companies have had the opportunity to conclude variable hour agreements with employees. Such agreements allowed part-time employees to work up to an additional eight hours within a seven-day period beyond their usual working hours.
The current Employment Contracts Act (§ 431) stipulates several additional conditions that must be met to enter into a variable hour agreement. For instance, the employer must keep a separate record of the employee's variable hours, and the employer cannot conclude such an agreement with more than 17.5 percent of its employees.
Variable hour agreements were used infrequently in practice because the conditions for concluding agreements are too stringent, and since such agreements could only be made for a limited time, this did not sufficiently motivate employers to incur the necessary costs for implementing the agreements, such as IT developments.
The possibility of concluding flexible working time agreements is being created
The Ministry of Economic Affairs and Communications has developed a draft law to amend the Employment Contracts Act, which aims to allow the parties to an employment contract to conclude flexible working time agreements instead of variable hour agreements in the future. Under a flexible working time agreement, an employee may work additional hours beyond the agreed working hours, and these additional hours will not be considered overtime.
The initial version of the draft sets out several conditions that must be adhered to when concluding a flexible working time agreement. For example, the employer is allowed to conclude such an agreement only with an employee who is obtaining primary, secondary, or higher education; who is of retirement age or has taken early retirement; who has reduced work capacity; or for whom the possibility of concluding a flexible working time agreement is provided for in the collective agreement.
Additionally, the employee must work at least a quarter load, and under a flexible working time agreement, the employee can work up to ten additional hours within a seven-day period beyond the agreed working hours. The total of the agreed working hours and additional hours must not exceed full-time hours. For example, if an employee's agreed working hours are ten hours per week and the additional hours are also ten hours, then the employee can work a total of 20 hours per week, and any time worked beyond that is considered overtime.