Energy crisis and labor law: Seven questions employers are currently asking.

 Consequences of the new energy-saving regulations and high costs for electricity and gas.

Energy crisis and labor law: Seven questions employers are currently asking.

In view of the impending shortage of gas and electricity in the coming winter, companies need to prepare contingency plans immediately, and commence talks with employee representatives.

For cost reasons alone, companies are currently considering how to save energy. Furthermore, lawmakers are heightening the pressure: The EU member states have committed to voluntarily reducing gas consumption by 15 percent between August 1, 2022, and March 31, 2023 in comparison to the average consumption of the last five years. Industry is also expected to make a contribution. In Germany, two new regulations stipulating energy-saving requirements also have to be observed: As of September 1, the Short-Term Energy Safeguarding Ordinance (EnSikuMaV) became mandatory for six months. This ordinance stipulates maximum temperatures for working areas in public buildings, as well as a ban on keeping entrances open in retail stores. In addition, the Medium-Term Energy Safeguarding Ordinance (EnSimiMaV) will come into force on October 1 and will remain in force for two years. This ordnance includes provisions governing technical energy-saving measures, and stipulates that energy management systems must be implemented. We answer seven labor law questions that employers are currently facing:

  1. Are employers required to lower the temperature in offices and factory halls?
    Initially, the obligation to lower temperatures only applies to public buildings. Private companies are only required to comply with the maximum temperatures defined in Section 6 of the Medium-Term Energy Safeguarding Ordinance (EnSimiMaV) if their business premises are located in public buildings. This is one degree below the minimum temperatures specified in Section 3 (1) of the Workplace Ordinance in conjunction with Annex 3.5 and the Technical Rules for Workplaces ASR 3.5 Room Temperature. Physically light and primarily sedentary activities, for example, require a maximum temperature of 19 degrees Celsius. The minimum temperature for physically strenuous activities will not be reduced.
    However, in the explanatory memorandum to the ordinance, the legislator appeals to companies to take the public sector as a role model. Not least because of the high energy prices, many companies are already making preparations which will enable them to reduce their heating in accordance with the requirements of the Medium-Term Energy Safeguarding Ordinance (EnSimiMaV). If this is the case, it may be necessary to carry out another risk assessment for the workplaces concerned on the basis of the new room temperature in accordance with Section 5 ArbSchG for the affected workplaces.
  2. What applies in the event of a gas or electricity shortage?
    The minimum temperatures of the Workplace Ordinance must also be complied with in the event of a power failure or if the Federal Network Agency is forced to ration gas. Therefore, employers need to implement technical and organizational to ensure that the required room temperatures are nevertheless maintained. Companies face the risk of fines in the event of violations. The Explanatory Memorandum to Section 6 states that companies must offer employees the opportunity to work from home if they face health risks due to excessively low temperatures.
  3. Home office as a solution?
    It remains unclear whether the federal government will reintroduce mandatory work from home as a means of saving energy needed to heat offices and commute to work. Regardless thereof, companies are also considering means of reducing costs by increasing the extent to which employees work from home. It is disputed whether employers are entitled to unilaterally instruct employees to work from home pursuant to their right to issue instructions. This only appears permissible in emergency situations, such as if the heating fails as a result of governmental intervention by the Federal Network Agency. Increasing energy costs are not an adequate justification.
    As such, it is advantageous for employees to have defined the legal conditions for mobile and hybrid working in advance by way of collective agreements, individual or company agreements. We have already covered the factors that need to be considered and the extent to which the works council has a say.
  4. Are employees entitled to compensation?
    As employees are also forced to pay the high energy prices, this gives rise to the question as to whether employers have to pay them an expense allowance if they spend more time working from home? The voices calling for an allowance are becoming louder because the lawmaker’s home office tax allowance expires on December 31, 2022. Accordingly, companies are advised to consult with the employee representatives ahead of time to negotiate mutually acceptable solutions, such as a lump-sum agreement, for example. In any case, employees have to take into consideration the costs saved by not traveling to work.
  5. Can employees simply stay at home if the temperature is too low?
    Employees are not entitled to refuse to work or to simply stay at home if the office is cooler than usual. Federal Labor Court has ruled that they only have a right to refuse performance if occupational health and safety violations have reached a certain level of severity. A specific and significant health risk must exist for which the employer cannot provide any remedy through suitable warm clothing or by bearing the cost of purchasing this clothing, for example.
    Employees do not have a fundamental right to work from home or to mobile work, as we have already reported.
  6. What co-determination rights does the works council have?
    When it comes to regulations governing occupational health and safety, employee representatives have a right of co-determination pursuant to Section 87 (1) No. 7 of the Works Constitution Act (BetrVG). Although employee representatives are not entitled to decide whether the temperature is lowered or not, they do have a say in how any health risks can be prevented, for example.
    Employers need to consider any co-determination rights arising from Section 87 (1) No. 6 of the Works Constitution Act (BetrVG) if they intend to introduce an IT-based energy management system in accordance with the Medium-Term Energy Safeguarding Ordinance (EnSimiMaV) which can be used to monitor the behavior and performance of employees. In practice, this is often the case.
  7. Short-time work as a remedy for energy-intensive companies?
    The conditions entitling companies that are particularly affected by the energy crisis to receive short-time working benefits and not yet clear. What applies if a company stops or decreases production as a means of reducing energy costs before the Federal Network Agency begins rationing gas for the company? Companies need to keep a close eye on how the situation develops.

Companies need to prepare for possible electricity and gas shortages during the winter. The potential for greater energy efficiency has to be explored and contingency plans developed. Talking with employee representatives is advisable in order to increase the workforce’s acceptance of any cost-reduction measures, The works council already has a right of co-determination with regard to many measures, such as technical equipment for energy management or health protection. Instead of imposing strict requirements, providing information about opportunities to achieve greater energy efficiency, organizing idea competitions and offering incentives for successful savings measures are often more promising approaches.