CLINT | Littler Insights!

Linking an overtime allowance to the full-time norm constitutes prohibited discrimination between full-time and part-time employees!

Prohibited discrimination between full-time and part-time employees

The law prohibits employers from paying full-time employees differently – i.e. more favorably – from part-time employees, unless the difference in pay can be objectively justified. However, this is not readily the case.??

Entitled to an overtime allowance?

The law does not provide any right to an overtime allowance. Employees only have this right if their employment contract or an applicable collective bargaining agreement provides that overtime work entitles them to an overtime allowance on top of their regular salary.

Many employment contracts or collective bargaining agreements make a distinction between “overtime” and “extra hours”.? There can only be overtime when the number of hours worked exceeds the applicable full-time norm. This means that if a part-time employee works more hours than agreed with them but fewer than the full-time norm, this qualifies as extra hours rather than overtime. Usually, there is only an overtime allowance and no extra work allowance.

Recent European Court of Justice (ECJ) judgment

The facts

Two nurses worked part-time at a German health care provider. The collective bargaining agreement provided that an overtime allowance would be paid only if the overtime exceeded the standard number of hours of full-time employees. According to the employer, this arrangement served to discourage employers from having part-time employees work more than the agreed number of hours. The employer also wanted to avoid less favorable treatment of full-time employees.??

Before the German court, the nurses relied on prohibited discrimination between full-time and part-time employees and demanded an overtime allowance on the extra hours they had worked. The German court referred a number of questions to the European Court of Justice for a preliminary ruling.

ECJ

According to the Court of Justice, the uniform hours threshold for an overtime allowance placed a heavier burden on part-time employees. After all, although the hours they worked on top of their contractual working hours were paid, they did not receive an overtime allowance for them.

The Court of Justice was of the opinion that such an arrangement constituted prohibited discrimination. Moreover, according to the ECJ, a uniform hours threshold was not suited to the purpose stated by the employer. On the contrary, the arrangement actually encouraged asking part-time employees to work extra hours because it was cheaper. The Court of Justice believed that full-time employees were not disadvantaged since they were equally entitled to an overtime allowance from the first hour they worked in excess of their contracted hours.

Conclusion

An arrangement in an employment contract or collective bargaining agreement that provides that there is only a right to an overtime allowance if the regular full-time norm applicable to full-time employees is exceeded, constitutes prohibited discrimination between full-time and part-time employees.? As a result, such an arrangement is void.

Employers and parties to a collective bargaining agreement would therefore do well to bring the agreements regarding overtime and extra hours in place in their business in line with this decision.

CLINT | Littler Explains! Podcast - Labor Snippets

In this episode of CLINT | Littler Explains!, Wouter Heere explores the complexities of summary dismissal. This drastic measure allows an employer to terminate employment immediately, without notice or severance, and has far-reaching consequences for employees. But when is such a dismissal legally valid, and what must an employer consider before taking this step?

Wouter breaks down the conditions that must be met for a summary dismissal, including the concept of an “urgent reason” and the legal obligations employers face. Through real-life examples, such as a court case involving a dismissed employee over a box of cakes, he highlights how personal and situational factors can impact the validity of an immediate termination.

What steps should employers take before proceeding with such a dismissal? And how can they avoid potential legal pitfalls?

Tune in now to gain expert insights into this critical employment law issue and practical tips for navigating these high-stakes decisions!