Since the ruling of the Federal Labor Court (BAG) of 13.09.2022, the topic of time recording has been treated with a certain degree of uncertainty in many companies. However, in the absence of statutory regulations, it is only clear that working time must already be recorded.
We also examine the data protection aspects of this topic, in particular the recording of data for internal and external billing purposes.
General information
The recording of employee time is not only frequently discussed in the media and politics, but also by courts and data protection authorities.
In fact, any processing of working time data also constitutes data processing within the meaning of data protection law, in which the prohibition of data processing without a legal basis and the supplementary requirements of data minimization and strict purpose limitation must be observed. Of course, you must always inform the employees concerned about the basic data processing.
In the case of employee time recording, this means that you are generally permitted to process the time recording data on the basis of the legal and/or contractual basis – but only to the extent necessary and only for a specific purpose:
- Billing data – for internal and external billing;
- Internal working time – to fulfill your obligations under the Working Hours Act and/or for controlling purposes.
Externally billable time
The legal basis for the time to be invoiced is the contractual relationship with your employee on the one hand and the contractual relationship with your customer on the other, insofar as remuneration for time has been agreed.
Depending on the agreement with the customer, this can of course also be done to the minute. However, the requirement to minimize data means that you may only provide the customer with the full name of the employee if they have a non-interchangeable relationship with the customer (project manager, contact person, specific hourly rate, desired specialist). For the purposes of transparency and allocation, however, disguising abbreviations can be used for employees.
Supervisors and the accounting department would be authorized to access this data.
Internal time recording
Due to the current ruling, you should set up a working time recording system now. The BAG envisages an extended documentation obligation, even if more specific statutory regulations have so far remained stuck at the draft stage.
You must therefore record the working hours in order to carry out the employment relationship – according to case law and legislators, in particular to protect the workforce against overtime.
The use of this data to monitor performance and behavior is possible, but is restricted by the need-to-know principle: the data may only be used to the extent really necessary for controlling purposes and may generally only be stored as raw data for two years.
However, such monitoring may only be carried out on a random basis(BAG, decision of 26.08.2008, 1 ABR 16/07). According to the data protection authorities in Lower Saxony and Rhineland-Palatinate, a monthly overview with actual/target hours is just as permissible as random checks by the management.
However, this data is reserved for management and the HR department, and possibly also for direct superiors.
Conclusion
Time recording for employees is mandatory. It will gradually become more transparent and digital. This opens up new possibilities, but also legal problems. An employee’s need for protection will often be affirmed, so that control measures should be legally examined in advance in individual cases.
