Richard Grogan

The case of Max-Planck-Gesellschaft zur Förderung der Wissenschaften eV v Tetsuji Shimizu (Case C-684/16) has completely changed the employment law landscape when it comes to claims under sections 11, 12, 13, 15 and 19 of the Organisation of Working Time Act 1997.

Some may rightly believe the CJEU is seriously pushing the boundaries of EU law to ensure States implement Directives properly. They are also radically altering the burden of proof and the duties of employers. So be it. The CJEU is the ultimate judicial body. Unless a Directive is changed, their decisions are binding - like them or not.

It had always been taken that the Directive which was implemented in Ireland in the Organisation of Working Time Act 1997 only had direct effect against State entities. The decision of the CJEU has now changed this.

Charter of Fundamental Rights of the European Union

The CJEU have determined that, due to the provisions of article 31(2) of the Charter of Fundamental Rights of the European Union, that a national court hearing a dispute between a worker and an employer who is a private individual must disapply the national legislation and ensure that, should the employer not be able to show that it exercised all due diligence in enabling the worker actually to take one of the rights specified under Article 31(2), which in this particular case was annual leave, that the worker cannot be deprived of his acquired rights to that paid annual leave or effectively any corresponding provision which is covered under the article. Article 31(2) of the Charter covers not only annual leave but also working hours and rest and break periods.

The judgment and the opinion of Advocate General Bot have huge importance for employers and employees going forward. It has been pointed out that the worker must be regarded as a weaker party in the employment relationship and that it is therefore necessary to prevent the employer being in a position to impose upon him a restriction of his rights (see Fuß, Case C-429/09). It was held that any practice or omission of an employer that may potentially deter a worker from taking his annual leave is equally incompatible with the purpose of the right to paid annual leave (Case C-214/16).

Because of dealing with article 31(2) of the Charter, when the case relates to paid annual leave, it will equally apply to rest and break periods and excessive working hours.

In relation to annual leave, and effectively also for any of the other rights, this does not require an employer to force the worker to claim the rest periods due to them.

However, subject to that reservation, the obligation now appears to be placed on the employer which needs to be reflected in the system of rules of evidence under which, in the event of a dispute, it is for the employer to show that the employer took the appropriate measures to ensure that a worker was able actually to exercise that right.

Burden of proof

Section 25 of our Act places the burden of proof on the employer. This has been interpreted by the Labour Court as requiring the employee to put forward effectively a stateable case or a minimum of prima facie case, subject to the reservation that the employee can only be required to put in place such evidence as is in the employee’s control. However, this decision now appears to have completely reversed that rationale and both the evidential and legal burden will be on the employer at the start.

The argument that employees may not have requested particular rights has been effectively set aside by the decision, in that the Court has held that the requirement for an employee to request one of their rights is irrelevant.

In this case, the CJEU held there could be no limitation on the right of an employee to go back to claim compensation for not obtaining their annual leave during the entire period of the employment. This puts the Irish legislation in breach of the European Directive. The effect of this now is effectively that claims for unpaid annual leave, which may go back years, will now have to be taken to the High Court rather than to the WRC or on appeal to the Labour Court.

It is necessary now for an employer to show that the employer took the necessary steps and that, in spite of the measures which were taken, the worker declined deliberately and in an informed manner to exercise his or her rights.

The CJEU pointed out that “there would be an obligation on an employer to encourage the employee … formally if need to be, to do so, while informing him, accurately and in good time so as to ensure that the leave is still capable of ensuring for the person concerned the rest and relaxation to which it is supposed to contribute, that, if he does not take it, it will be lost at the end of the reference period or authorised carry over period”.

The Court pointed out that if the employer is able to discharge the burden of proof in that regard and that it appears that it was deliberate and in full knowledge of the ensuing consequences that the worker refrained from taking the paid annual leave (or effectively any of the periods of rest and relaxation covered by article 31(2)), the Directive does not preclude the loss of that right.

Due diligence

The CJEU has held that unless an employer is able to show that it had exercised all due diligence in enabling a worker to take the relevant rest period, then the worker cannot be deprived of his or her acquired rights.

This test of due diligence is going to place a significant burden on employers. The obligations are already there under the relevant statutory instruments to maintain records, but employers are going to need to be a lot more diligent in checking these records and making sure that they are up to date for all rights under sections 11, 12, 13, 15 and 19 of the Act. It will no longer be a defence for an employer to say “we advised the employee” or that the employee did not raise any grievance. It will be a matter for the employer to show that they applied due diligence in making sure that the employee obtained the relevant rights.

Irish legislative issues

Because the legislation will now have direct effect, there is a problem with section 12 of the Act. Section 12 of the 1997 Act provides that an employer “shall not require” the employee to work for longer than specified period without taking a rest period, which is the breaks at work, being the 15 and 30-minute breaks. The Directive uses the word that the employee shall “ensure”.

The first issue is whether the word “ensure” is equal to the words “shall not require”. If they are not, then, where employees bring claims, if the employer can show that they did not require the employee not to take the breaks, then in those circumstances there may well be a claim against the State by employers for failing to properly implement the Directive. The alternative would be that claims will have to be brought to the High Court. This creates significant cost for the unsuccessful party.

We have written to the Minister for Employment Rights and Social Protection, but also to the Minister for Justice. It is one thing if there are going to be claims against the State for failing to properly implement the Directive. It is an entirely different matter if claims are now going to have to be brought or could be brought to the High Court. This would mean that effectively, while our section 12 Organisation of Working Time Act cases would go for a first instance hearing in the High Court, with an appeal then to the Court of Civil Appeal. This concerns us.

It would be a significant use of Court time which can be rectified very easily by the Organisation of Working Time Act in section 12 being amended as a matter of urgency, to comply with the Directive, which, we might add, it should have done from day one.

• Richard Grogan is the principal solicitor at Richard Grogan & Associates Solicitors. You can subscribe to the firm’s monthly newsletter at grogansolicitors.ie.