The Court of Justice of the European Union (CJEU) released a judgment on 10 September 2015 concerning whether or not travel time may be deemed working time. This decision may have significant implications for employers and employees and in this release we consider the impact for employers on managing working time and employee pay.
The case in question (Case C-266/14) concerned a Spanish business that was engaged in the installation and maintaining of security systems. Whilst the head office was based in Madrid, the company had technicians scattered throughout the country who would not have had an office in their area. In the morning, these employees would travel directly from their homes to customers for installing and maintenance purposes and in the evening they would travel directly home. The employees sought to argue that the time spent travelling to their first appointment and travelling from their last appointment was in fact “working time”.
The CJEU has agreed with the employees and has clearly stated that “where workers… do not have a fixed or habitual place of work, the time spent by those workers travelling each day between their homes and the premises of the first and last customers designated by their employer constitutes working time…”
The reason for this decision is based on the three essential requirements for working time; namely that the employee (a) is at their workplace and (b) is at their employer’s disposal, and (c) is carrying out activities for their employer. The CJEU decided that the employees in question met all three requirements when travelling to and from their first and last appointments as they don’t have a fixed workplace and the time spent travelling is for the purposes of completing work at the behest of their employer.
What is a Fixed or Habitual Place of Work?
Importantly, this decision is limited to employees who “do not have a fixed or habitual place of work” and as such it relates to field-based or peripatetic employees who do not normally work from a company office. Therefore, an employee who works in their company’s office cannot argue that their daily commute to and from work is actually working time.
Will Employees Have to be Paid for this Travel Time?
This decision relates to “working time” under the Working Time Regulations 1998 and therefore focusses on the calculation of breaks and rest periods. It does not concern the payment of wages because that is covered under separate legislation, the National Minimum Wage Act 1998 and the Court was not asked to deliberate this point. As such, the CJEU decision did not address this question and employers do not need to change their payment practices as a result of this ruling. Employers should note, however, that previous case law has ruled that the time spent travelling from one assignment to another during the working day should be factored into the calculation of minimum wage.
Therefore, it would likely require an amendment to the National Minimum Wage Act for employees to become entitled to payment for this travel time.
How Does this Impact On Rest Breaks?
The key factor for employers to take away from this is that this decision will greatly impact rest breaks. Generally, employees must get a minimum rest break each day in addition to getting daily rest periods of at least 11 consecutive hours and weekly rest periods of at least 24 consecutive hours. Going forward, employers will need to factor this travel time when identifying when an employee must take their rest breaks. As an example, if an employee stays late at a customer site installing a security system and does not return home until 10 pm at night, this employee will need 11 consecutive hours rest and therefore should not commence their journey to their first appointment the following day until at least 9am.
Employers should consider how many field based employees in their organisation may be affected by this judgment and should update their practices accordingly. A failure to ensure appropriate rest periods may result in the employer falling foul of the Working Time Regulations.
An employer is also required to specify an employee’s hours of work in the employee’s terms and conditions of employment and this could include breaks. Therefore, employers are advised to review their contractual policies and ensure that they are suitable and in line with the above. This may involve specifying in an employee’s contract that this travel time is deemed working time.
There is a risk that employees will take the “scenic route” to and from work to maximise their working time. This is particularly a risk should it be deemed that payment is required for this travel. As such, employers may wish to update their disciplinary policy to account for this type of misconduct.
Importantly, employers should always seek advice before changing any terms and conditions of employment.