Termination without notice due to working time fraud
This ruling by the State Labor Court judges in Hanover once again highlights the importance of data protection when using video surveillance. In the case in question, the defendant manager of a foundry had terminated an employee for working time fraud without notice even though the plaintiff denied the accusation. The employer submitted a video recording from the factory gate as evidence. This video recording showed that the employee had not entered the company premises for the night shift.
Despite obvious misconduct: The justified expectation of privacy takes precedence
According to the Lower Saxony State Labor Court (LAG), the accusation of working time fraud does fundamentally justify termination without notice. However, the company was unable to prove that the plaintiff had breached their duty as the State Labor Court refused to admit the video recording at the entrance to the company premises as evidence. This was because the employer had committed to only retain surveillance camera data for 96 hours in an internal operating concept. According to the “Duration of data storage” section, notice signs specified this as the maximum storage period. The Lower Saxony State Labor Court stated that the defendant employer had “blatantly violated” this self-imposed rule. Therefore, the employee had the right to trust in this self-imposed obligation and had a “legitimate expectation of privacy” in accordance with which the video images would no longer be utilized.
Evidence inadmissible due to GDPR violation
In addition, rules in favor of the plaintiff prohibiting the use of evidence apply. In the process, the court orients it’s ruling on the case law of the Federal Labor Court: The first step consists of determining whether a violation of substantive law has occurred. If this is confirmed, the second step consists of examining whether the court would violate a fundamental right of the employee in the specific case if the court were to use the evidence obtained in this way. If so, the rule prohibiting the use of evidence applies. In this specific case, the Lower Saxony State Labor Court confirmed that the use of the video recordings represented an unlawful violation of the plaintiff’s fundamental right to informational self-determination as set forth in Article 2 of the German Basic Law. Processing of personal data pursuant to Section 26(1) of the Federal Data Protection Act is only permissible if the video images have to be evaluated in order to perform or terminate the employment relationship. Or if the evaluation as necessary to detect a crime. However, the Lower Saxony State Labor Court did not regard these requirements as having been fulfilled.
Not a “chance find”
Accordingly, the court cited the Federal Labor Court’s ruling, which stated that the proportionality must be examined: The processing and use of personal data would have to be suitable, necessary, and appropriate, while taking into account the freedoms guaranteed by the Basic Law, in order to achieve the intended purpose. There must be no other means available which impose fewer restrictions on the personal rights of the persons concerned and which can achieve the objective equally effectively. However, the State Labor Court ruled that this was not the case: The video surveillance itself was unsuitable as a means of proving working time fraud. It merely documented when people enter and exit the plant premises. Therefore, it was only possible to conclude when the employee was present on the company premises. However, it was not possible to prove the beginning and end of the actual working time. Nor was video surveillance essential given that there are other and more reliable options, such as having supervisors record working hours by supervisors or utilizing technical solutions such as time cards or card readers. Finally, video surveillance is also not an appropriate method of monitoring working hours and identifying related crimes. The intensity of the interference was disproportionate to the employer’s interest because the employer had specifically reviewed and assessed the video records more than a year later on suspicion of working time fraud. Therefore, this did not represent a “chance find” which would have been permissible.
Although the plaintiff’s working time fraud was beyond doubt, the plaintiff nevertheless succeeded in suing for protection against wrongful dismissal before the Lower Saxony State Labor Court, as he had before the Hanover State Labor Court. The employer’s data protection violation outweighed the working time fraud in this case. The Federal Labor Court will decide on the appeal on June 29, 2023.
Duty to record working hours does not justify full monitoring
Data protection limits more than just video surveillance: The Federal Labor Court and European Court of Justice have stated that employers must systematically record their employees’ working hours, as we have already reported. However, this is intended to protect employees and not to justify technical monitoring. Therefore, any technical systems suitable for monitoring and surveillance must not exceed the scope necessary to achieve the employer’s legitimate objectives. The Federal Labor Court has ruled that the same applies to Microsoft Office 365, for example, because the combination of specific components and functions enables comprehensive performance and behavioral monitoring.
Employers require a legitimate interest
Examples of a legitimate interest in monitoring on the part of the employer could be: The company checks which websites employees view while at work. This is especially true if the employment contract excludes private use of the Internet. As a rule, monitoring the workload it is permissible such as when and how often an employee logs into a program. Conversely, superiors cross the line if they utilize key loggers, for example, without a reasonable suspicion of a criminal offense or other serious breach of duty. This refers to hardware or software which can monitor and reconstruct all input made by the user on the computer.
Consequences for employers
What are the consequences for employers with regard to measures for monitoring working hours and performance?
- A thorough data protection review is the top priority
According to the GDPR, personal data may only be collected for specified, clearly defined and legitimate purposes. The purpose for which the employer processes data must be clearly and understandably explained to the affected parties. If the company uses Microsoft Office beyond the actual purpose of the technical installation, for example, a thorough data protection assessment is essential. This applies even if the works council has agreed to the data processing. The proportionality and appropriateness of data processing must be carefully examined and the extent of the of intervention must always be minimized.
- A company agreement creates transparency
A company agreement can set clear rules for technical equipment for monitoring and, therefore, justify data processing under specific circumstances. According to Section 87(1)(6) of the Works Constitution Act (BetrVG), companies with a works council are subject to a right of co-determination in any case when the company intends to implement technical systems which are also capable of monitoring. As such, a company agreement also has to be concluded.
- Carefully phrase non-utilization clauses
Non-utilization clauses in company agreements require particular care: For example it is essential to distinguish between a targeted search for evidence and what is referred to as “chance finds”, which are generally permissible. To prevent the argument of a “legitimate expectation of privacy”, clear rules on procedures and permissions for evaluating the data collected are advisable.
Video surveillance in the workplace is a sensitive issue. The ruling by the Lower Saxony State Labor Court has highlighted this once again. HR managers need to pay special attention to data protection and work to conclude a company agreement. This not only applies to video recordings but essentially to all technical systems capable of monitoring behavior and performance. Companies have always examined the effectiveness and performance of their employees. However, digitization has simplified this and created even more opportunities. As already reported, wearables such as data glasses, smart gloves with sensors or scanners also have to be closely examined with regard to data protection.