Are you seeing a shift in employee/workforce expectations in your jurisdiction, when it comes to flexibility, length of the contract, remote working, hours of work, etc? How can clients both reflect this and protect their business interests in employment contracts?
There was already an increase of questions from our clients related to flexibility in working hours, as well as the legal issues regarding remote working. Now, as a result of the COVID-19 pandemic, many clients introduced a remote working policy, allowing employees to work remotely 2 out of 5 working days on average. Clients now feel this has become an expectation and believe that like this, a healthy work/ life balance is reached. Also, many clients accepted a remote working policy, because it gives them an extra argument towards potential candidateemployees to choose their company as their new employer. Next to that, it allows companies to save costs on their working space.
Of course, this calls for measures regarding working control and the safety of confidential information. Employers should make sure that whatever system they put in place, still allows them to differentiate on an individual level, based on performance.
Next to that, legislation has been put in place very recently, allowing employees to remain working full-time, but spread their working time over 4 instead of 5 days per week. Also, the possibility of a working cycle of mostly 2 weeks, and in some cases up to 4 weeks has been discussed. It remains to be seen whether these new possibilities will prove successful. With the war for talent still raging out there, I can imagine that at least some employers will want to participate in this, thus also making them even more attractive for candidate employees.
On top of this, the new legislation can allow for employees to already start working for another employer in case they have been dismissed with a notice period. This is what is now called a “transition path” in the new law. In such a case, it can be agreed that a part of the salary, or even the entire salary, is compensated by the new employer. Also, extra measures to promote a quicker re-employment of the employee are introduced and a part of the employer cost, dedicated to the notice period or indemnity, is now reallocated for this purpose.
Other recent legislation has been introduced, mainly as a result of the European Directive on transparent and predictable working conditions (n° (UE)2019/1152), foreseeing all kinds of new rights for employees, such as the right to receive information/confirmation regarding certain working conditions, as well as to apply more flexible working conditions for a certain period to take care of a child up to 12 years or a family member for medical reasons.
What are the biggest benefits and risks to businesses facilitating a more transient workforce?
When talking about remote working, the biggest benefits are cost savings and making the company more attractive for candidateemployees. Of course, this can also be a factor in retaining existing employees. The main challenge is to achieve a climate of trust and a healthy balance between remote working and office work. And also on how to deal with certain individuals that will, sooner or later, abuse the employer’s trust. Policies put in place should not deprive employers of any rights in this area.
When talking about a “transient workforce” as a more temporary workforce, composed of freelance workers or contractors, the benefit for companies can be to have more flexibility, enabling them to respond more rapidly to their quickly changing business needs at limited cost. However, a company that is unaware of the legal risks involved in this, especially in a country like Belgium, could afterwards be paying for this in cash. The provision of a temporary workforce to companies and the delegation of employer authority are strictly regulated, and in many cases even totally forbidden. I believe Belgium has one of the strictest legislations in place in this area. And, even when allowed, one should still be aware that several legal mechanisms exist, thus enabling the government to hold companies liable for certain breaches of the law, especially in the area of social security and employment, by their business partners.
TOP TIPS
- Define your business needs when it comes to the workforce and seek advice on how these needs can be met, taking into account the legal framework of the jurisdiction(s) your company is in. This can be very different from one country to another.
- Perform a thorough check on your potential business partners before engaging with them. However, there is no reason not to do this when already in a contractual relationship – allowing you to address issues proactively, before they become a real problem that could cost you a lot of money.
- Non-competition and confidentiality clauses can be interesting tools that should be drafted taking into account local legislation and case law. Bare in mind that enforcing such clauses is not always easy.
- Think about exclusivity and training deduction clauses, allowing workers to reimburse costs for training provided.
- In light of recently introduced legislation, existing clauses should be reviewed to see if they can still be enforced.
How are you helping your clients to manage legislative and taxation issues around their transient workforce? For example, are there bilateral agreements with other jurisdictions or tax provisions to be aware of?
We assist clients in drafting and enabling policies, adapted to their situation. In the case of cross-border situations, questions related to applicable tax, social security, and employment law are addressed.
When it comes to concluding contracts and collaborating with independent contractors and freelancers, we are consulted to examine whether a contractor is trustworthy; or whether a freelancer is okay to hire as a self-employed worker. In that perspective, we have developed certain standards any contractor or collaboration with a freelance worker should live up to, depending on the nature of the client’s business. One of the key elements a contractor or freelancer should always live up to is the ability to provide a decent contract to our client. Such a contract must show that they are professional and aware of the legal risks at stake in their area of activity. In the absence thereof, we will mostly advise our client against doing business with such a party, regardless of the other elements of the check we perform.
